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A family loan agreement is a legally binding document that facilitates the lending of money between relatives. Unlike informal loans, this agreement instills trust between the lender and borrower. It outlines essential terms such as the names and contact information of both parties, loan amount, payment schedules, special conditions, and late payment terms. While family loans may not always include interest, they adhere to the same principles as other lending contracts. It's crucial for the agreement to be signed, dated, and witnessed by at least two individuals to ensure its validity.
