It is important to verify that the people who wish to sign are the authorized signatories of the company. If a party declares more than one capacity, there should be a separate signature block for each capacity. In every credit agreement, you need some basic information that is used to identify the parties who agree to the terms. You will have a section that describes who the borrower is and who the lender is. In the borrower section, you need to contain all the borrower`s information. If they are a natural person, this includes their full legal name. If it is not an individual, but a company, you must indicate the company or entity name that must contain „LLC“ or „Inc.“ to provide detailed information. You must also provide your full address. If there is more than one borrower, you must include the information of both on the credit agreement. The lender, sometimes also called the holder, is the person or company that provides the borrower with the goods, money or services as soon as the agreement has been concluded and signed. Just as you took the borrower`s information, you need to include the lender`s information in as much detail. If you are lending money to someone, you will need to prove that the loan was not a gift to the borrower. A credit agreement is proof of your commitment and describes the terms of your credit.
It is important that both parties are protected by a credit agreement, which is why it is subject to your signature and their signature. You might also want to receive information about prepayment if the borrower wants to repay the loan early. Many borrowers are worried about the down payment and you should include in your credit agreement a clause that talks about advance options, if any. If you authorize a prepayment, you must include this information and details, whether they are allowed to pay the full amount or only a portion in advance, and whether you ask for an advance fee if they wish. If you are asking for an advance fee, you must describe in detail the amount of this amount. Traditionally, lenders require that a percentage of the principal be paid in advance before they can pay the balance. If you do not authorize prepayment, you must specify that it is not allowed unless you, the lender, give written authorization. Whether you`re a finance professional or calling for a loan, DocuSign has the solution for you.
Sign up for our 30-day free trial to learn more. To turn a static credit agreement into a fillable credit agreement template, go to documents in your SignNow account: It`s also important to consider the security documents that support the credit agreement. These may need to be witnessed as deeds. Replace the „[Sender.State]“ in yellow with the state in which the lender operates. This defines the laws of the region that govern the credit agreement and affects all disputes that may arise in the event of default by the borrower after missing enough monthly payments. If you`re trying to figure out if you need a credit agreement, it`s always best to be on the safe side and make one. If it is a significant amount of money that will be refunded to you, as agreed by both parties, then your time is worth taking the extra steps to ensure that the refund is made. A credit agreement must protect you, that is, in case of doubt, create a credit agreement and ensure that you are protected no matter what. . .