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A personal loan agreement is a legal contract between a lender and borrower for lending money, which can involve banks, credit entities, or individuals. Unlike standard loans, which specify how funds must be used (e.g., mortgages or student loans), personal loans offer more flexibility in fund usage and can be unsecured, meaning they're not tied to specific assets. Some personal loans might require collateral, which should be detailed in the contract. Essential elements of a personal loan agreement include the names, addresses, and signatures of both parties, the state of execution, the contract date, and the total loan amount.
