How to fill in this loan agreement
- 1Date signed
e.g. November 12, 2026 - 2Place signed
e.g. Calamba City - 3Lender's full name
e.g. Rosario M. Aguilar - 4Lender's civil status
e.g. married - 5Lender's address
e.g. 12 Mabini St., Brgy. Real, Calamba City, Laguna - 6Borrower's full name
e.g. Mark Anthony P. Dela Cruz
Collateral the safe way
Describe the collateral so it cannot be swapped — plate, engine and chassis numbers for a vehicle; title number for land. The LENDER may hold the original papers, but may not keep the collateral as payment if the loan goes unpaid (Civil Code art. 2088): it must be sold through foreclosure, and any excess goes back to the BORROWER.
Register a mortgage when it matters
For a vehicle or land, this agreement binds the two of you. To bind third parties (a later buyer, another creditor), sign a separate chattel mortgage or real estate mortgage and register it with the Registry of Deeds; a vehicle mortgage is also annotated at the LTO.
Release the money in a way you can prove
The agreement says how the loan was released. Use a bank transfer or GCash and keep the reference number; for cash, have the BORROWER sign an acknowledgement receipt too.
- Write the amount, rate and term before printing — the schedule follows from them.
- Check the first due date; every later date is the same day of each following month.
- Both parties sign every page, before two witnesses, with valid IDs attached.
When a payment is missed
Send a written demand first (DocsOfUs has a demand letter). Parties in the same city or municipality must go through barangay conciliation before court; claims up to PHP 1,000,000 can then go to small claims court, without lawyers.
Questions people ask
Can I just keep the motorcycle if the borrower does not pay?
No. An agreement that the lender automatically owns the collateral on default is void under Philippine law (pactum commissorium). The lender must foreclose — through a public sale — and return any amount above what is owed.
Is there a legal limit on interest?
The Philippines has no fixed ceiling on private loans, but courts cut down interest they find unconscionable — rates of several percent a month are often reduced to 12% a year or less. Interest must be written in the agreement; without it, none is due.
How is the interest worked out here?
Straight-line: the yearly rate is applied to the original principal for the whole term, and the total is split evenly across the months. Every installment is the same amount. A bank's diminishing-balance loan charges less interest at the same rate — say so in the agreement if that is what you agreed.
Does a loan agreement need to be notarized?
No — it binds the parties once signed. Notarizing makes it a public document, easier to prove and enforce. A mortgage on land or a vehicle must also be registered to bind third parties.
Is this legal advice?
No. It is a common Philippine format for a personal loan. For a business lending money regularly, a large loan, or land as collateral, ask a lawyer.
This page explains common practice and is not legal advice. Offices set their own rules — when in doubt, call ahead or ask your notary or lawyer.