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The Loan Contract With Collateral is essential for secured lending transactions in the Philippines, providing a legally robust framework for both lenders and borrowers. It is commonly used when a borrower requires financing while offering specific assets as security, ensuring the lender has recourse to identified collateral in case of default. The document must comply with Philippine banking regulations, the Civil Code, and security interest laws, including proper registration requirements for the collateral. This type of agreement is particularly important for business financing, asset acquisition, and project funding, offering lenders better security than unsecured loans while potentially providing borrowers with more favorable terms due to the reduced risk profile.

1. Parties: Identifies and provides complete details of the Lender and Borrower, including their legal names, addresses, and corporate details if applicable

2. Background: Sets out the context of the loan agreement and the parties' intention to enter into a secured lending arrangement

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes rules for interpreting the document

4. Loan Amount and Purpose: Specifies the principal amount of the loan and its intended use

5. Interest Rate and Charges: Details the interest rate, calculation method, and any additional fees or charges

6. Repayment Terms: Specifies the repayment schedule, installment amounts, and payment methods

7. Collateral: Describes the assets provided as security, including their detailed description and value

8. Security Interest: Creates and defines the security interest over the collateral

9. Representations and Warranties: Contains statements of fact and promises made by the Borrower regarding their status and the collateral

10. Covenants: Sets out ongoing obligations of the Borrower regarding the loan and collateral

11. Events of Default: Lists circumstances that constitute default and trigger enforcement rights

12. Enforcement Rights: Describes the Lender's rights and remedies upon default

13. Notices: Specifies how formal communications between parties should be made

14. Governing Law and Jurisdiction: Establishes Philippine law as governing law and specifies jurisdiction for disputes

15. General Provisions: Contains standard boilerplate clauses including amendments, severability, and entire agreement