Can a loan agreement be signed electronically?

Yes. Under the federal ESIGN Act (15 U.S.C. ch. 96) and UETA in most states, electronic signatures are legally valid when the parties show intent, consent, attribution, and retention capability.

When is notarization required?

Not all loan agreements need notarization. Notarization is commonly required for deeds, mortgages, or when state law or recording offices demand an acknowledgment; check jurisdictional rules before execution.

What happens if names don’t match?

Mismatched legal names can invalidate UCC filings or cloud title to collateral. Correct names to match formation documents or obtain corrective joinder or amendment before recording.

Are witness signatures commonly needed?

Witness requirements vary. Many commercial loans do not require witnesses, but certain states or deed-related instruments may require one or two witnesses for recording.

How should collateral be described?

Describe collateral with specific identifiers (serial numbers, addresses, account numbers) and state the UCC filing jurisdiction to ensure perfected security interests.

How long should I keep the signed agreement?

Retain the signed agreement for the loan term plus at least three additional years; for tax or health-related matters, follow IRS or HIPAA retention rules as applicable.

Electronic Signature
Templates
Finance
Borrower Loan Agreement

Borrower Loan Agreement

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

BORROWER LOAN AGREEMENT

This Borrower Loan Agreement (the Agreement) is entered into by and between the parties identified below effective as of the Effective Date stated herein. The parties agree as follows.

Parties

Lender Name: Lender Address: Borrower Name: Borrower Address:

Recitals

Lender has agreed to lend and Borrower has agreed to borrow upon the terms and subject to the conditions set forth in this Agreement.

Loan Terms

Principal Amount:

Interest Rate (annual, fixed):

Loan Date: Maturity Date:

Payment Frequency: Number of Payments:

Repayment Terms (description):

Prepayment: Borrower may prepay the Loan in whole or in part without penalty. If prepayment penalty applies, describe:

Prepayment Penalty Description (if any):

Late Charge: If any payment is not received within days after its due date, Borrower will pay a late fee of .

Security

This loan is: Unsecured Secured

If secured, describe collateral and security interest:

Representations and Warranties

Borrower represents and warrants that Borrower is duly authorized to enter into this Agreement, that all information provided is true and complete, and that no event or condition exists that would constitute a default under any other agreement after giving effect to this Agreement.

Covenants

Borrower covenants to make payments when due, to maintain the condition of any collateral, to provide financial statements upon Lender's request, and to comply with applicable law in the operation of its business and in performance of this Agreement.

Events of Default and Remedies

Events of Default include Borrower's failure to pay principal or interest when due, breach of any representation, insolvency, filing of a petition in bankruptcy, or material adverse change in Borrower's financial condition. Upon an Event of Default, Lender may declare the entire unpaid principal and accrued interest immediately due and payable and pursue all remedies available at law or equity, including enforcement of security interests.

Payment Instructions

Payment Remittance Details:

Accepted payment methods:

Governing Law; Notices

This Agreement will be governed by and construed in accordance with the laws of the jurisdiction specified below. Notices required or permitted under this Agreement shall be in writing and delivered to the addresses set forth above or to such other address as a party may designate in writing.

Governing Law (State):

Miscellaneous

Integration: This Agreement, together with any promissory note and security documents executed in connection herewith, constitutes the entire agreement of the parties and supersedes all prior agreements relating to the subject matter hereof.

Additional Terms or Special Provisions:

Acknowledgement

Each party acknowledges that it has read and understands this Agreement, has had the opportunity to obtain independent legal advice, and that the persons signing below are authorized to bind the respective parties.

Lender - Print Name:

By:

Date:

Borrower - Print Name:

By:

Date:

What a Borrower Loan Agreement Is and When it Applies

A Borrower Loan Agreement is a written contract that sets out the terms under which a lender provides credit to a borrower. It identifies the parties, describes the principal amount, specifies interest rate and fees, defines the repayment schedule, and documents any security or collateral. The agreement allocates rights and remedies for events of default, states governing law and dispute resolution, and records any representations or covenants. Lenders, borrowers, and counsel use this document to create enforceable expectations and to support regulatory, tax, and audit records for the loan transaction.

Why a Clear Loan Agreement Matters

A well-drafted Borrower Loan Agreement reduces ambiguity about payment obligations, limits legal exposure, and preserves remedies on borrower default while improving enforceability and recordkeeping.

Who Typically Prepares and Signs a Borrower Loan Agreement

Lenders, borrowers, attorneys, loan officers, and closing agents all work with this agreement to document loan terms and protections.

Commercial lenders and banks — create standard loan packages and attach schedules and security documents.
Small business owners and borrowers — submit financial details and agree to repayment terms.
In-house and external counsel — review representations, covenants, and compliance provisions.

Roles vary by transaction size and industry; ensure authorized signatories and any required witness or notary steps are identified before execution.

Essential Sections to Include in a Professional Loan Agreement

Include clear, enforceable provisions that cover parties, amounts, interest, repayment, security, and default remedies to reduce later disputes.

Parties

Full legal names, entity types, and addresses for lender and borrower; include authorized signatory details and EINs where applicable.

Loan Amount

State principal in dollars, draw schedules if applicable, and any commitment or availability period with rounding rules.

Interest

Specify APR or formula, interest accrual method, payment frequency, and default interest rate if different.

Repayment

Describe payment dates, amortization schedule, balloon payments, grace periods, and prepayment treatment or penalties.

Security

Identify collateral, security interests, UCC filing obligations, and perfection steps including filing jurisdiction.

Default Remedies

Define events of default, notice and cure periods, acceleration, and lender's enforcement rights including foreclosure processes.

Required Data Elements at a Glance

Borrower Legal Name: Exact legal name

Lender Legal Name: Exact legal name

Loan Amount: Principal in USD

Interest Rate: APR numeric value

Repayment Schedule: Payment cadence

Collateral Description: Collateral details

How to Complete and Execute the Agreement

Follow these sequential steps to prepare, review, sign, and store the executed Borrower Loan Agreement.

01

Prepare Document: Populate all fields and attach schedules.
02

Legal Review: Have counsel review key clauses and compliance.
03

Execution: Collect signatures, dates, and notarization if required.
04

Record & File: File UCC or record deed as applicable.

Setting Up a Digital Signing Workflow

Configure signing order, authentication, and required attachments to ensure a compliant e-execution and reliable audit trail.

Field	Configuration
Authentication Method	Email link \| SMS code \| ID check
Routing Order	Sequential or parallel signer flow
Conditional Fields	Show fields only if condition met
Notarization Option	Choose RON or in-person notary

Where to File, Send, and Store the Executed Agreement

After signing, route the agreement to the parties and any required filing authorities, and retain copies for compliance and audit.

Send to Parties: Email executed copies to lender and borrower
Record Secured Interest: File UCC-1 in borrower’s state if required
Deposit with Counsel: Store a signed copy with legal counsel
Archive Securely: Retain electronic and physical originals

Digital Signing and Technical Compatibility

Choose a signing platform that supports the required authentication and produces an audit trail and tamper-evident PDF.

Supported Formats: PDF, DOCX, HTML
Integrations: Salesforce | NetSuite | Google Workspace
Security Standards: TLS in transit; AES-256 at rest

Ensure the platform can support any required addenda — for example, a HIPAA BAA — and can retain audit logs to meet ESIGN and internal recordkeeping policies.

Key Dates and Timing Expectations

Identify and communicate crucial dates such as effective date, funding, first payment, and notice periods to avoid missed obligations.

Effective Date:

Date when rights and obligations begin

Funding Date:

Date funds are disbursed to borrower

First Payment:

First scheduled payment MM/DD/YYYY format

Regular Payments:

Monthly or other recurring due date

Default Cure Period:

Specified number of days to cure default

Common Preparation Errors to Avoid

Using informal or abbreviated legal names that differ from formation documents, which can invalidate security filings or create collection obstacles.
Leaving blank or vague descriptions for collateral or repayment terms, causing disputes about enforcement scope and borrower obligations.
Failing to confirm authorized signatory authority for entities, which may render signatures void or subject to ratification.
Neglecting to identify governing law and venue, producing unnecessary complexity during dispute resolution or cross-jurisdiction enforcement.

Consequences of an Incorrect or Incomplete Agreement

Loan Acceleration: Lender may demand full repayment

Loss of Security: Unclear collateral may hinder foreclosure

Tax Withholding: Missing TIN may trigger 24% backup withholding

Enforceability Risk: Defective signatures can void obligations

Regulatory Exposure: Consumer loans may trigger disclosure penalties

Litigation Costs: Attorney fees and court expenses

eSignature Vendor Pricing and Feature Snapshot

Comparison of common features and starting prices for eSignature platforms used to execute loan agreements; signNow appears first as the first column for parity across vendors.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day free trial	Varies by vendor	Varies by vendor	Varies by vendor	Varies by vendor
Bulk Send	Yes	Yes	Yes	Yes	No
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Yes	Yes	No	No
Envelope Cap	No cap	100 envelopes/user/year	Varies	Varies	Varies

Real-World Examples of Borrower Loan Agreement Use

Two anonymized customer scenarios illustrate typical uses and operational choices when completing a loan agreement.

Optica Ventures (Brian Fitzgibbons)

Optica used a standardized loan template for working capital

They combined digital signatures with conditional collateral schedules
The result improved turnaround and reduced manual follow-up by consolidating forms into a single execution package.

Martin Properties (Tim Martin)

A real estate investor used the agreement for a bridge loan

Execution required notarization and recording instructions
The combined online signing and RON workflow allowed funding within a shortened closing window while preserving recording-ready documents.

Frequently Asked Questions About Borrower Loan Agreements

Answers to common questions on signing, enforceability, notarization, and handling errors when completing a Borrower Loan Agreement.

Need help? Contact support

Can a loan agreement be signed electronically?
Yes. Under the federal ESIGN Act (15 U.S.C. ch. 96) and UETA in most states, electronic signatures are legally valid when the parties show intent, consent, attribution, and retention capability.
When is notarization required?
Not all loan agreements need notarization. Notarization is commonly required for deeds, mortgages, or when state law or recording offices demand an acknowledgment; check jurisdictional rules before execution.
What happens if names don’t match?
Mismatched legal names can invalidate UCC filings or cloud title to collateral. Correct names to match formation documents or obtain corrective joinder or amendment before recording.
Are witness signatures commonly needed?
Witness requirements vary. Many commercial loans do not require witnesses, but certain states or deed-related instruments may require one or two witnesses for recording.
How should collateral be described?
Describe collateral with specific identifiers (serial numbers, addresses, account numbers) and state the UCC filing jurisdiction to ensure perfected security interests.
How long should I keep the signed agreement?
Retain the signed agreement for the loan term plus at least three additional years; for tax or health-related matters, follow IRS or HIPAA retention rules as applicable.

be ready to get more

Join over 28 million airSlate SignNow users

Sign Now