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A loan agreement is a written contract between a borrower and lender that outlines the terms for repaying lent money. The borrower commits to repay according to a specified schedule, either through regular payments or a lump sum. Loan agreements are important because they legally enforce repayment obligations. Various types of loan agreements exist, including those for personal, business, home equity, car, and student loans. Other forms include family loan agreements, which involve borrowing money between family members, and IOUs, which are informal acknowledgments of debt that generally lack detailed repayment terms or interest rates.
