Loan agreement template (Uganda)
In brief
A precedent loan agreement recording the terms of a loan between a lender and a borrower.
When to use this
When lending or borrowing money on agreed terms.
When a bespoke document is needed instead: For a secured property loan — pair with a mortgage and take advice.
The template
A precedent only. Replace every [PLACEHOLDER] with your own details; it contains no real party data. Have it reviewed before use.
Title
LOAN AGREEMENT
Date & parties
THIS AGREEMENT is made on [DATE]
BETWEEN [LENDER NAME], of [ADDRESS] (“the Lender”) AND [BORROWER NAME], of [ADDRESS] (“the Borrower”).
1. The loan
1.1 The Lender lends and the Borrower borrows the sum of UGX [AMOUNT] ([amount in words]) (“the Loan”), advanced on [DATE] to [account].
2. Interest
2.1 Interest accrues on the outstanding Loan at [RATE]% per [annum/month], [simple/reducing balance], from the advance date.
3. Repayment
3.1 The Borrower shall repay the Loan with interest [in [number] instalments of UGX [AMOUNT] on the [DAY] of each month from [DATE] / in full on [DATE] / on demand].
3.2 The Borrower may prepay [without penalty / on [terms]].
4. Default & acceleration
4.1 On any default (missed payment, insolvency, breach), the whole outstanding Loan with accrued interest becomes immediately due, and the Lender may enforce any security and recover costs.
5. Security
5.1 The Loan is [unsecured / secured by [a guarantee from [GUARANTOR] / a mortgage of [PROPERTY]]], documented separately.
5.2 Where secured by a mortgage of a matrimonial home, the spouse’s informed consent is obtained.
6. General
6.1 Entire agreement; variation in writing; no waiver; severability; governed by the laws of Uganda; disputes resolved by the courts of Uganda.
Execution
Lender: ____________ Date: ________ Witness: ____________
Borrower: ____________ Date: ________ Witness: ____________
Drafting notes
- Interest
- State the interest rate and basis clearly; avoid unconscionable rates that a court may reduce.
- Repayment
- Set a clear repayment schedule, prepayment terms and the default/acceleration consequence.
- Security
- If secured, document the security (guarantee/mortgage) separately and correctly, with any required spousal consent.
- Spousal consent
- A mortgage over a matrimonial home needs the spouse’s informed consent (Mortgage Act ss.4–5).
Execution requirements
- Both parties sign, with a witness; an agreement above the statutory value threshold must be in writing.
- Where secured by a mortgage of a matrimonial home, obtain the spouse’s consent (Mortgage Act ss.4–5).
- Keep records of advances and repayments.
Governing law & citations
Governed by the Contracts Act, Cap. 284 (2023 Revision); where secured, the Mortgage Act, Cap. 239.
- Contracts Act, Cap. 284 (2023 Revision) — s.9.
- Mortgage Act, Cap. 239 (2023 Revision) — ss.4–5.