Borrowing money starts with making clear agreements.
If you take out a loan with a lender or a bank, you sign a contract as standard. This contract states, among other things, the interest that you must pay, the amount of the monthly repayment amount, the amount of the loan amount and the term of the loan.
When you borrow money from family or take out another type of private loan, it is also necessary to draw up a contract. To prevent misunderstandings, it is useful to engage a notary. This helps you prepare the contract and ensures that the agreements made are on paper. Applying for a loan from a professional intermediary is of course often simpler and cheaper.
Before you sign a contract, it is of course a tip to read it carefully first. This way you know for sure whether you are doing well to take out a loan.
The structure of a contract
A contract consists of a fixed set-up and there are set rules for what should really be in it.
In any case, the names of the borrower and the lender must be stated in the contract. These are at the top of the first page. It is then immediately clear who borrows money.
The following text is mentioned under the names: ‘Declare to have agreed’. After this it was determined point by point what exactly was agreed. These points are described clearly and concretely. The precise duration, interest rates and loan amount are therefore clearly defined.
The contract also describes the following:
- The date of the loan
- The amount involved
- The borrower confirms that the said sum is due
- The interest and when it is paid
- The closing costs of the loan
- The term of the loan
- The repayment method
To be sure that all necessary points are mentioned in the contract, it is advisable to engage a notary. Especially when it concerns a family loan or private loan. If the contract meets all legal requirements, it can be signed by the lender and borrower.
It is also possible to take out a loan through an intermediary. This forms the link between the lender and the consumer. It is therefore an ideal person to conclude a loan contract with. Through this website you come in contact with an intermediary. This helps you immediately with taking out a loan.