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a loan agreement is a document that represents the formal evidence of a loan the document also includes important details such as covenants positive or negative ones the information on the collateral such as loan type and its value as well as guarantees the applicable interest rates fees the conditions ing to which the loan is to be repaid and the period of repayment envisaged to sum up the loan agreement contains the terms and the conditions that are pointed out so that the borrower can draw out a loan the terms and conditions are set by the lender which can be a bank or another type of financial institution in fact the loan represents a type of facility that is offered by the lender and that is why the agreement on the conditions under which a loan can be taken out is also referred to as a facility agreement the agreement comprises four sections the first section contains the terms that are to be used in the document and their definitions the second section is concerned with the oper
