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A loan agreement is a written contract between a borrower and lender outlining the terms for repayment of borrowed money. The core of the agreement is the borrower's commitment to repay according to an established schedule, which may involve regular payments or a lump sum. Loan agreements are legally binding, providing security for the lender. Common types include personal, business, home equity, car, and student loans, each designed to specify repayment terms. Other variations include family loan agreements for borrowing between relatives and IOUs, which are informal confirmations of borrowed funds without detailed repayment terms or interest rates.
