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It is common to also include each party's address. The names of the lender and borrower need to be stated. There are 10 basic provisions that should be in a loan agreement. Usually, an IOU and a promissory note form are only signed by the borrower, although they may be signed by both parties.Ī loan agreement is a single document that contains all of the terms of the loan, and is signed by both parties. If the promissory note is secured by collateral, there is also a mortgage securing real property, or a financing statement securing personal property. Another type of document is a promissory note, which typically includes an interest rate and terms of repayment.They do not usually say when payment is due, nor include any interest provisions. The most basic loan agreement is commonly called an "IOU." These are typically used between friends or relatives for small amounts of money, and simply state the dollar amount that is owed.Loan agreements, promissory notes, and IOUsĪ loan agreement is any written document that memorializes the lending of money. It is important to understand the various types of loan documents, and be aware of the ten provisions discussed below that should be included in a good loan agreement. But for loans between friends or relatives, you will need to create your own loan agreement. For loans by a commercial lender, the lender will provide the agreement. A loan agreement should accompany any loan of money.