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The Family Loan Agreement is designed for use in Nigeria when family members wish to formalize a lending arrangement with legally binding terms. This document becomes necessary when one family member is lending money to another and both parties want to ensure clarity and legal protection while maintaining family relationships. It incorporates requirements under Nigerian law, including the Contract Law, Money Lenders Act, and Stamp Duties Act, while providing flexibility for interest rates, repayment terms, and dispute resolution methods appropriate for family contexts. The agreement can be particularly useful in preventing future misunderstandings by clearly documenting the loan terms, repayment expectations, and consequences of default, while including options for family-oriented dispute resolution before pursuing legal remedies.

1. Parties: Identifies the family members involved as lender and borrower, including their full legal names, addresses, and relationship

2. Background: Explains the context of the family loan and the intention to create legal relations

3. Definitions: Defines key terms used in the agreement for clarity

4. Loan Amount and Purpose: Specifies the exact amount being lent and its intended use

5. Repayment Terms: Details the repayment schedule, including payment amounts, frequency, and completion date

6. Interest: Specifies whether interest applies and if so, the rate and calculation method

7. Method of Payment: Specifies acceptable payment methods and account details

8. Early Repayment: Sets out terms for early repayment of the loan

9. Default: Defines what constitutes default and consequences

10. Representations and Warranties: Basic statements about the parties' capacity to enter into the agreement

11. Governing Law: Confirms Nigerian law governs the agreement

12. Signatures: Space for parties to sign and date the agreement