Money is one of the most liquid assets in a business. And if you happen to be in the money lending business, cash flows out every time someone borrows from you and flows in after they repay you. But what assures you that you will be getting back all the amount borrowed from you? Being in this type of business has its pros and cons, which is why you need to secure yourself before diving into a lending transaction with your clients.
Sample Security Agreement
What more is the safest option in processing a loan than to require proof that your clients can repay you in time. Your client’s credit scores and income availability to repay loans is their ticket to getting their loans approved. And of course, seeing that they have a solid history of borrowing responsibility as well as their ability to repay their loans on time surely is a green light. But is that enough to secure your assets?
Listed below are a few sample agreements that are helpful for lenders like yourself to have an assurance of the security of your assets.
1. Sample Lenders Program Security Agreement
Financial institutions are widely known for lending a significant sum of money to people, and no doubt, it is very beneficial to both parties. But the idea and the risk of not getting paid are still a problem, and if not treated it can lead to bankruptcy. So, how can you prevent this scenario from happening? Let your clients sign an agreement that demands the security of your assets in exchange for a loan. In this way, you can avoid inconveniences and unwanted risks in the process while providing the service your clients need.
2. Sample Security Agreement
Banks and other financial institutions can decide whether to give out secured or unsecured loans; either way, both have their benefits and risks. But if you are the one who prefers to keep things insured during the long-run of a loan, you will do better with a secured loan. This sample security agreement has everything you need as assurance that you won’t lose profit in case your debtor fails to pay you on time.
3. Sample of a Basic Security Agreement
Collateral is an essential aspect of approving a loan. Without it, you do not have much assurance that your debtor will repay you the expected amount on the promised date. This sample security agreement provides information that requires collateral for every secured loan you offer to your clients. Listed along with the terms and conditions on what may occur in case a loan is unpaid on the expected date.
4. Sample of a Non-Negotiable / Non-Transferable Security Agreement
Non-negotiable agreements are commonly applicable for instances when you do not wish to adjust or make any changes to a condition settled between you and your clients. At the same time, this agreement applies to goods, and security ownership are not readily transferable to a different party. This sample agreement is preferable if you consider having a non-negotiable and non-transferable security agreement with your clients.
5. Sample of Commercial Security Agreement
Every company’s top priority is to gain profit and to maintain the security of their assets. When lending an amount, it is best to keep collateral to assure yourself that your money will return to you. Collateral are useful because people are likely to take action to retrieve their property by repaying you rather than losing them for a debt. This commercial security agreement is beneficial for lenders like yourself who want to start a lending business that offers secured loans.
6. Sample of a Security Agreement and Financing Statement
Assets such as personal properties can be collateral. For clients who are willing to loan from your institution, these collateral are crucial to getting their loans approved. By pledging their assets to you, you have the responsibility to keep it safe until they can pay off their debts. By default, if your clients fail to repay you, you have the right to seize and sell their collateral to repay the debt. This sample security agreement and financing statement have everything you need to complete your secured loan transaction.
7. Sample of a Simple Security Agreement
Having a loan with collateral to back it up is a better investment for lenders who are prone to having debtors with a bad credit history or limited income. This does not only benefit your debtor but is also for you because your debtors don’t want to lose their collateral. Thus, the chances of getting repaid on time are higher than getting no payments at all.
8. Sample Aircraft Security Agreement
Cash is not the only thing people borrow. People under the field of aviation also rent aircraft and their equipment to complete their activities. Not all people can afford to buy their aircraft, so they tend to borrow one from aviation financing institutions. Repaying aircraft equipment may take longer than a standard loan does, which is why it is safer to secure yourself from losing profit. This sample aircraft security agreement contains all the necessary information you need to secure long-term loans from your clients.
9. Sample Direct Loan Security Agreement
Compared to other loans, direct loans are straightly given to the borrower rather than through a third party. This is commonly done in non-bank institutions and the government, but other banks also provide a direct loan to their clients. This can be a student loan or a home purchase. If you are practicing a direct loan in your institution, this sample direct loan security agreement befit your needs.
10. Sample Promissory Note and Security Agreement
As your debtor receives their loan, they are obligated to return the exact amount borrowed from you in a defined period. Before closing an entire transaction, you need to let them sign an agreement requiring them to repay you. For secured loans, this sample promissory note and security agreement will come in handy in aiding you with your transactions.
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