Using a loan agreement is an essential tool whenever you are lending someone else money. Although on the surface it would seem fairly simple, there are a very large number of regulations surrounding the operation of all forms of credit lending in Australia. This is particularly so since the introduction of the National Consumer Credit Protection Act 2009 (Cth) which has began to implement a new raft of changes in relation to the credit regulations. This includes the need to license is engaging in non-exempt credit activities.
In some circumstances, the formation of loan agreement even between family members may be the subject of the regulation being introduced under the new National Consumer Credit Code. In New South Wales, there is also a substantial system of regulation surrounding the operation of the mortgages stemming from the provisions of the old consumer credit code and the the Real Property Act which defines the form that a registered mortgage needs to be in and what the mortgage can bind a person to, what rights the mortgagee has to repossess property which it it the subject of a registered mortgage and other things which can be very important aspects of the securing of rights under the mortgage.
Loan agreements can cover many different types of loans as well. There can be loan agreements relating to credit cards, real property, personal property. However, not all of these types of loans can be secured. A good example of an unsecured loan is for a credit card, there is no security against a credit card debt. However, the best example of secured loan is a loan against the family home for a mortgage over the the property which is a secured loan. If you have any queries about how loan agreements can be formed or if you need to have a loan agreement drafted, please do not hesitate to contact us using any of the methods on this website. We would be more than happy to speak with you about any loan agreement that you are a party to.