Generate a professional business loan agreement with customizable interest rates, repayment schedules, collateral provisions, financial covenants, and comprehensive default remedies. Define exact loan terms, security interests, and borrower obligations to protect both lender and borrower interests.
I built this business loan agreement generator to help lenders and borrowers document commercial loan transactions with the precision and completeness that modern lending requires. Loan disputes frequently arise from ambiguous terms around interest calculation methods, default triggers, or covenant compliance, and this generator addresses every one of those scenarios with clear, enforceable language. Whether you are a bank, credit union, private lender, or business owner, this tool produces a professional agreement ready for review by counsel.
The generator supports both fixed and variable interest rate structures with configurable index rates, margin calculations, and day-count conventions. It includes comprehensive provisions for collateral and security interests, UCC financing statements, personal guarantees, financial covenants with specific ratio requirements, and detailed events of default with cure periods and acceleration clauses. Every section is conditionally rendered based on your selections, so the final document includes only the provisions relevant to your specific loan structure.
Every field updates the live preview instantly, so you can see exactly how your loan agreement will read before downloading. The generator includes optional sections for balloon payments, prepayment penalties, variable rate adjustments, and guarantor obligations. Whether you are structuring a simple term loan or a complex secured facility, this tool produces a document that covers the essential legal protections both parties need.
Key features include: dynamic section numbering that adjusts based on your selections, conditional collateral and guarantee provisions, configurable financial covenant requirements, multiple interest calculation methods, and comprehensive signature blocks for lender, borrower, and guarantor.
The generated agreement also addresses conditions precedent to disbursement, application of payments waterfall provisions, representations and warranties that repeat on each payment date, and survival clauses that ensure key obligations continue beyond loan repayment. For variable rate loans, the generator includes floor rate protections and specifies the exact index rate and adjustment frequency. The document is designed to be used as a starting point and should be reviewed by qualified legal counsel before execution.
A business loan agreement is a legally binding contract between a lender and a borrower that sets out the terms of a commercial loan. It specifies the principal amount, interest rate, repayment schedule, collateral requirements, financial covenants, events of default, and remedies available to the lender.
A comprehensive business loan agreement should include the principal loan amount, interest rate and calculation method, repayment schedule, late payment fees, prepayment provisions, collateral and security interests, financial covenants, reporting requirements, events of default, acceleration clauses, representations and warranties, and governing law provisions.
A secured business loan requires the borrower to pledge specific assets as collateral. If the borrower defaults, the lender can seize and sell the collateral. An unsecured loan does not require collateral but typically carries a higher interest rate. Secured loans generally offer lower rates and higher borrowing limits.
Financial covenants are conditions the borrower must maintain throughout the loan term, such as minimum revenue thresholds, maximum debt-to-equity ratios, minimum current ratios, and minimum net worth requirements. Breaching these covenants can trigger an event of default.
When a borrower defaults, the lender typically can accelerate the loan so the entire balance becomes immediately due, charge default interest, seize collateral, pursue the personal guarantor, and seek legal remedies. Most agreements include a cure period allowing the borrower time to remedy certain defaults.
Whether a personal guarantee is required depends on the lender, borrower creditworthiness, and loan amount. Most commercial lenders require personal guarantees from owners holding 20% or more equity. A personal guarantee makes the guarantor personally liable if the business cannot pay.