Best way to draw up a loan agreement? Lawyer? Accountant? DIY kit (like a will)?

I need a really simple loan agreement drawn up between two individuals. Person A had lent money to Person B, and there is interest to be paid. Simple as that.

What's my best course of action? Should I see a lawyer, my accountant? Is there a DIY kit like they have for wills? Or is there some sort of government provided template that we can just use?

 

only lawyers can draw up deeds and contracts.

It is not as simple as you think either so get some legal advice too.

 

Thank you. What sort of ballpark figure would it be to do this?

 

I charge $990

I should add you could do your own loan agreement too - at your own risk.

 

Fraught with danger.

Could be the cheapest $1,000 you have ever spent!

How much are you lending/borrowing? what is the security?

Blacky

 

Depends on the amount of the loan!. If you are lending $1000 then it might be the dearest $1000 ever spent.

BTW contracts can be oral - but it is advisable to put them in writing for evidence reasons.

 

Just use @Terry_w i have seen loan agreement dreadfully drafted.

Such agreement should be in writing with exact terms spelled out, terms of repayment, recourse etc.

 

You don't need a loan agreement until you need one and then when you do it's too late.

It's always when things go bad that you need a good one.

Terry is cheap on that one - we charge $1500 plus GST for a registered (or registerable) mortgage or PPSR security loan. I'd see Terry in a heartbeat on that one, especially since he can advise on the tax implications also.

 

I will have to raise my prices. Sorry I am overwhelmed with existing clients and can't take on any more work atm.

 

You should definitely raise your prices then.

 

Is this between relative parties (e.g. spousal loans or something) and you need only for tax perspective or something...

 

Crayon.

 

There is no simple agreement, what if Person B dies, cannot repay the debt, pays only part of the interest, is late in paying interest, is there maturity date, etc... Lots of things can happen to person B that may no longer be able to pay then what?
I had lent to say Person B, and had my lawyer draw up the DEED OF LOAN. I rather be safe then sorry. It did not really cost that much if you wish to sleep well at night!

 

There are occasions where the loan agreement is just there for taxation purposes. If you lend money to your spouse or family member (I know this one can be dangerous) then you really only want the agreement for good house keeping.

I had my solicitor do one for me as part of my last conveyancing and it only cost me a few hundred dollars. It was a loan from a family member to myself with no registered security.

 

Not necessarily.

Imagine you lend you money to your spouse. She dies and you find out the agreement is unenforceable. Her will leaves everything to the Dalai Lama's personal secretary. Her ex-husband makes a family provision claim as does the Filipino orphan she had been supporting (financial dependant).

 

Perhaps a "uber type" stuff you I am busy pricing model?

Good Stuff Terry.

Cheers Ivan

 

Yeah the thing here is the father is actually gifting the money. I don't think he ever intends for it to be paid back. But as I understand it he wants to do this for tax reasons, not sure about the specifics. That's why they don't want to spend a lot as it's not a real loan per se.

 

In that case he could just transfer the money and make a hand written deed himself so that it is clear he doesn't want it back.

 

I'm with you Jaybean. Everyone on here is trying to protect your interests because we're all skeptical.

 

In that case...check out Credi....I was reading an atricle and came across this....

CRedi - The Relationship Lending Platform