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A credit facility agreement is a contract that outlines a type of loan used in business or corporate finance. This includes various forms such as revolving credit, term loans, and business loans. Essentially, a credit facility allows a bank to lend money for business purposes. However, banks are legally restricted from lending their own funds; instead, the money originates from the borrower. The borrower's signature is crucial as it effectively creates money, as described in "modern money mechanics." This concept highlights how debt and credit systems operate, emphasizing that by utilizing good credit and processed credit agreements, individuals can finance purchases and manage debt more effectively.
