Family Loan Agreement Template

This template is designed for loans between family members or friends, where having clear boundaries and a written record can help avoid misunderstandings later. It is an alternative to our standard personal loan agreement and is intended for simple lending arrangements linked to a particular financial expense.

What This Family Loan Agreement Template Does

It allows the parties to set out the loan terms clearly, with a choice of repayment options and an amendments clause so the repayment schedule can be extended or varied if needed. It also includes a prepayments clause and an electronic signature clause.

Interest And Tax Considerations

The template can be used with or without interest. Charging interest may help reinforce that the payment is a loan and not a gift. However, whether or not interest is charged, there may be tax implications (including income tax where interest is payable and potential inheritance tax considerations where no interest is charged). You should seek independent advice before deciding whether to charge interest.

When You May Need Something More

If you need more protection for the lender, consider using one of the other loan agreement templates in this collection.

Important Note On Consumer Lending

NOTE: This agreement is not intended to be regulated by the Consumer Credit Act 1974 which requires that businesses that lend money to consumers must be licensed to do so or those that engage in regulated activity must be regulated by the Financial Conduct Authority (FCA). This agreement is not intended for consumer purposes. You can be imprisoned and fined if you carry out regulated activities without being authorised.

Family Loan Agreement Template is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.