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Free Loan Agreement Template

Document any personal or U.S. business loan with clear repayment terms, interest rates, and default provisions. Fill in your details, download a professional American PDF in minutes.

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LOAN AGREEMENT
Effective As Of April 1, 2026
LENDER
Cornerstone Capital LLC
200 Park Avenue, Suite 1500, New York, NY 10166
By: a limited liability company, (212) 555-0400 | lending@cornerstonecap.com
BORROWER
Sarah J. Mitchell
45 Riverside Drive, Apt 12C, New York, NY 10024
By: an individual, (212) 555-0187 | sarah.mitchell@email.com
Principal: $75,000.00 · Interest: 6.5% per annum
Payments: monthly
This Loan Agreement ("Agreement") is entered into as of April 1, 2026, by and between the Lender and Borrower identified above. The parties agree to the following terms and conditions governing the loan described herein.
1.
LOAN
Subject to the terms and conditions of this Agreement, Lender agrees to loan to Borrower, and Borrower agrees to borrow from Lender, the principal sum of $75,000.00 ("Principal Amount"). Lender shall disburse the Principal Amount to Borrower on or before the Loan Date specified above. Borrower acknowledges and agrees that the receipt of the Principal Amount constitutes valuable consideration for the promises and obligations set forth in this Agreement.
2.
INTEREST
The outstanding principal balance of this Loan shall bear interest at a fixed annual rate of 6.5% per annum, calculated on a simple interest basis using a 365-day year and actual days elapsed. Interest shall accrue from the Loan Date and shall be computed on the outstanding principal balance from time to time. Usury Savings Clause. In no event shall the interest charged or collected hereunder exceed the maximum rate permitted by applicable state usury law (including, where applicable, the criminal-usury thresholds of N.Y. Penal Law §190.40, the civil-usury limits of Cal. Const. Art. XV §1, Tex. Fin. Code ch. 303, or Fla. Stat. §687.03) or any applicable federal ceiling. If any interest contracted for, charged, or received would otherwise exceed the maximum permitted rate, the rate shall automatically be reduced to the maximum lawful rate, and any excess already received shall, at Lender's option, be refunded to Borrower or applied to reduce the outstanding principal balance. For U.S. federal income tax purposes, if the stated rate is below the applicable federal rate ("AFR") then in effect under IRC §1274 or §7872, the Parties acknowledge that imputed-interest rules may apply and agree to report the Loan consistently with those provisions.
3.
REPAYMENT
Borrower shall make monthly payments in the amount of $1,470.00, commencing one month after the Loan Date and continuing on the same day of each subsequent month until the Maturity Date of April 1, 2031, at which time the entire remaining balance of principal and accrued interest shall be due and payable in full. Each payment shall be applied first to accrued interest and then to the outstanding principal balance.
4.
PREPAYMENT
Borrower may prepay this Loan in whole or in part at any time without penalty or premium. Any prepayment shall be applied first to any accrued and unpaid interest and then to the outstanding principal balance. Partial prepayment shall not excuse or reduce the subsequent scheduled payments unless Lender agrees in writing.
5.
REPRESENTATIONS, WARRANTIES, AND REGULATORY STATUS
Each party represents and warrants to the other that: (a) it has the full legal right, power, and authority to enter into this Agreement and to perform its obligations hereunder; (b) this Agreement constitutes a legal, valid, and binding obligation enforceable in accordance with its terms; (c) the execution and performance of this Agreement does not violate any law, regulation, court order, or agreement to which it is a party; and (d) all information provided in connection with this Agreement is true, accurate, and complete in all material respects. Borrower further represents that the loan proceeds will be used for business, commercial, or investment purposes (and not for personal, family, or household purposes), so that this Agreement is not a "consumer credit transaction" subject to the Truth in Lending Act, 15 U.S.C. §§1601 et seq., or the ability-to-repay / qualified-mortgage rules of the Dodd-Frank Wall Street Reform and Consumer Protection Act codified at 15 U.S.C. §1639c. If this Agreement is accompanied by a separately executed promissory note, such note shall be a "negotiable instrument" within the meaning of UCC §3-104 and shall be governed by UCC Article 3, including the six-year statute of limitations on negotiable instruments set forth in UCC §3-118. Borrower acknowledges that, in the event of a bankruptcy filing by Borrower, the automatic stay under 11 U.S.C. §362 will apply to collection and enforcement activities, and Lender reserves all rights to seek relief from stay under 11 U.S.C. §362(d) and to assert any allowed secured or unsecured claim.
6.
LATE PAYMENT
If any payment is not received within 10 day(s) after its due date ("Grace Period"), Borrower shall pay a late fee equal to 5% of the overdue payment amount. The late fee is in addition to, and not in lieu of, any other remedies available to Lender under this Agreement or applicable law. Acceptance of a late payment or late fee by Lender shall not constitute a waiver of any default or of any right or remedy available to Lender.
7.
SECURITY INTEREST (UCC ARTICLE 9)
To secure the full and timely payment of all obligations under this Agreement, Borrower hereby grants to Lender a continuing security interest, under Article 9 of the Uniform Commercial Code ("UCC") as enacted in the governing state, in the following property ("Collateral"):

2024 Tesla Model 3, VIN: 5YJ3E1EA7PF123456, currently titled in the name of Sarah J. Mitchell

This Agreement constitutes a security agreement satisfying the requirements of UCC §9-203 (attachment). Borrower authorizes Lender, without further consent, to file one or more UCC-1 Financing Statements in all appropriate state filing offices to perfect this security interest under UCC §9-308 and to take any other action reasonably necessary to perfect or continue perfection, including obtaining control of deposit accounts and investment property under UCC §§9-104 and 9-106. Priority among competing secured parties shall be determined under UCC §§9-317, 9-322, and 9-324 (purchase-money priority), as applicable. Upon the occurrence of an Event of Default, Lender shall have all rights and remedies of a secured party under UCC Part 6 (UCC §§9-601 through 9-628), including the right to take possession (UCC §9-609), to conduct a commercially reasonable public or private disposition (UCC §§9-610 to 9-613), to collect proceeds directly from account debtors (UCC §9-607), and to apply proceeds in the order of priority set forth in UCC §9-615.
8.
PERSONAL GUARANTEE
David R. Mitchell ("Guarantor") hereby unconditionally and irrevocably guarantees to Lender the full and prompt payment and performance of all obligations of the Borrower under this Agreement. This guarantee is a continuing guarantee and shall remain in full force and effect until all obligations have been paid and performed in full. The Guarantor waives notice of acceptance of this guarantee, notice of any default, and any right to require Lender to proceed against the Borrower or any collateral before enforcing this guarantee.
9.
EVENTS OF DEFAULT
The following shall constitute Events of Default under this Agreement:

(a) Failure to make any payment when due and such failure continues for more than 10 day(s) after the due date;
(b) Breach of any representation, warranty, or covenant in this Agreement;
(c) Borrower becomes insolvent or files for bankruptcy, or a bankruptcy petition is filed against Borrower;
(d) Any material adverse change in Borrower's financial condition that impairs Borrower's ability to repay this Loan;
(e) Any judgment or lien is entered against Borrower that Lender reasonably determines may impair repayment;
(f) Sale or transfer of collateral without Lender's prior written consent;
(g) Change in Borrower's employment status resulting in material income reduction;
10.
ACCELERATION
Upon the occurrence of any Event of Default, Lender may, at its sole option and without further notice or demand, declare the entire unpaid principal balance of this Loan, together with all accrued and unpaid interest, late fees, and any other amounts due hereunder, immediately due and payable in full ("Acceleration"). Upon Acceleration, the outstanding balance shall bear interest at the default rate of 18% per annum until paid in full. This remedy is in addition to, and not in lieu of, any other remedies available to Lender under this Agreement or applicable law.
11.
ATTORNEY'S FEES AND COSTS
In the event that Lender is required to take legal action to enforce any provision of this Agreement or to collect any amounts due hereunder, Borrower agrees to pay all reasonable attorney's fees, court costs, collection costs, and other expenses of enforcement incurred by Lender, whether or not suit is filed, and whether incurred in connection with collection, trial, appeal, bankruptcy proceedings, or otherwise.
12.
DISPUTE RESOLUTION
Any dispute arising out of or relating to this Agreement shall be resolved exclusively in the state or federal courts located in New York. Both parties consent to the exclusive jurisdiction and venue of such courts and waive any objection thereto.
13.
GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of law principles. Both parties agree to comply with all applicable federal and state lending laws and regulations.
14.
GENERAL PROVISIONS
This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, and agreements, whether written or oral. No modification or amendment of this Agreement shall be effective unless in writing and signed by both parties. If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall continue in full force and effect. All notices under this Agreement shall be in writing and shall be deemed received when delivered personally, sent by certified mail (return receipt requested), or sent by overnight courier to the addresses set forth above. The waiver of any breach of this Agreement shall not constitute a waiver of any subsequent breach. This Agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, executors, administrators, successors, and permitted assigns. Borrower may not assign this Agreement without the prior written consent of Lender.
IN WITNESS WHEREOF, the parties have executed this Loan Agreement as of the date first written above.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date first written above.
LENDER
Cornerstone Capital LLC
a limited liability company
Cornerstone Capital LLC
Date: ____________________
BORROWER
Sarah J. Mitchell
an individual
Sarah J. Mitchell
Date: ____________________
GUARANTOR
David R. Mitchell
Guarantor
David R. Mitchell
Date: ____________________

What Is a Loan Agreement?

A loan agreement is a legally binding contract used throughout the United States between a lender and a borrower that documents the terms of a loan. It specifies the amount of money being lent, the interest rate (if any), the repayment schedule, and what happens if the borrower fails to repay. U.S. loan agreements are used for personal loans between individuals, family loans, business loans, and any situation where one party lends money to another and wants the arrangement documented in writing.

Without a written agreement, proving the existence and terms of a U.S. loan becomes extremely difficult. Verbal agreements about money are enforceable in theory but nearly impossible to prove in American court. A written loan agreement protects both parties: the U.S. lender has evidence of the debt and its terms, and the borrower has proof of the agreed-upon interest rate and repayment schedule, preventing the lender from later demanding different terms.

U.S. loan agreements are governed by state contract law and, depending on the loan amount and interest rate, may also be subject to federal and American state lending regulations such as usury laws, the Truth in Lending Act (TILA), and state consumer protection statutes. For loans between individuals or small businesses, a well-drafted agreement provides the legal framework needed to make the loan enforceable and to protect both the lender's investment and the borrower's rights.

What's Covered in This Template

Doxuno's loan agreement template includes all the essential clauses for a comprehensive and enforceable loan contract in any U.S. state.

Lender & Borrower Details

Principal Amount

Interest Rate

Repayment Schedule

Late Payment Penalties

Prepayment Terms

Collateral & Security

Acceleration Clause

Default & Remedies

Governing Law

Co-Signer / Guarantor

Attorney's Fees

How to Create Your Loan Agreement

Doxuno's template guides you through every section. Complete the form and download your loan agreement in minutes.

  1. 1

    Enter lender and borrower information

    Provide the full legal names, addresses, and contact details of both the lender and borrower. If either party is a business entity, use the legal entity name and include the authorized signer's name and title.

  2. 2

    Set the loan amount and disbursement

    Enter the principal amount being lent, the date the funds will be delivered, and how they will be transferred (bank wire, check, cash, or other method). Specify whether the full amount is provided at once or in multiple disbursements.

  3. 3

    Define interest and repayment terms

    Choose whether the loan is interest-free or carries an annual interest rate. Select the calculation method (simple or compound) and the repayment schedule: lump sum at maturity, monthly installments, weekly payments, or a custom plan. Set the final maturity date.

  4. 4

    Add optional clauses

    Enable additional protections based on your situation: late payment fees, prepayment rights, collateral or security interest, acceleration clause, co-signer provisions, or attorney's fees clause. Each option can be toggled on or off.

  5. 5

    Review, download, and sign

    Review the completed agreement and download your professional PDF. Have both parties sign and date the document, with each party keeping a signed copy. Notarization is recommended for larger loans but is not legally required for most personal lending.

Legal Considerations for Loan Agreements

While this template is designed to be valid across all U.S. states, American lending laws vary by state. Review the following considerations before finalizing your loan agreement.

This template is provided for informational purposes and does not constitute legal advice. For large loans, commercial lending, or if you are unsure about usury limits in your state, consult a licensed attorney in your jurisdiction.

Reviewed by legal professionals. The content on this page and the template clauses have been reviewed by licensed attorneys in the United States to ensure accuracy and legal soundness for standard personal and business lending situations.

Usury Laws

Every U.S. state has usury laws that cap the maximum interest rate a lender can charge. These limits vary widely across American states: some allow up to 25% or more for personal loans, while others cap rates at 6% to 10%. Charging interest above the U.S. usury limit can render the loan unenforceable, expose the lender to civil penalties, and in some states, constitute a criminal offense. Always check your state's usury limits before setting the interest rate.

IRS Imputed Interest (Below-Market Loans)

If you make a loan to a family member at zero interest or at a rate below the U.S. IRS Applicable Federal Rate (AFR), the IRS may impute interest income to the lender. This means the American lender may owe income tax on the interest they should have charged, even if no interest was actually collected. For loans over $10,000, consider charging at least the AFR to avoid imputed interest issues.

Secured vs. Unsecured Loans

An unsecured loan relies solely on the borrower's promise to repay. A secured loan is backed by collateral (such as a vehicle, real estate, or equipment) that the lender can seize if the borrower defaults. To properly secure a loan, the lender should file a UCC-1 financing statement with the state or, for real estate, record a deed of trust or mortgage with the county. Without proper perfection, the security interest may not hold up against other creditors.

Statute of Limitations

Each U.S. state has a statute of limitations for debt collection, typically ranging from three to ten years for written contracts. If the lender does not file a lawsuit within this period, the debt may become unenforceable under American law. The clock usually starts running from the date of the last missed payment or the date the borrower defaulted. Knowing your U.S. state's limitation period is important for timely enforcement.

Frequently Asked Questions

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