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Secured Loan Agreement for India

Secured Loan Agreement Template for India

This document is a comprehensive Secured Loan Agreement governed by Indian law, structured to facilitate lending transactions while ensuring adequate security for the lender. It incorporates provisions compliant with Indian banking regulations, the SARFAESI Act, and other relevant legislation. The agreement details the loan terms, security arrangements, enforcement mechanisms, and includes provisions for creating and perfecting security interests in accordance with Indian registration and stamp duty requirements. It addresses both the commercial aspects of the lending relationship and the technical requirements for creating enforceable security interests under Indian law.

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Secured Loan Agreement

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What is a Secured Loan Agreement?

The Secured Loan Agreement is a fundamental document in Indian banking and finance, used when a lender provides financing against specific collateral or security. This agreement is essential for transactions where the lender requires security interests in the borrower's assets as protection against default. The document must comply with various Indian laws including the Transfer of Property Act, SARFAESI Act, and state-specific stamp duty requirements. It typically includes detailed provisions about the security creation, perfection requirements, enforcement mechanisms, and the rights and obligations of all parties. The agreement is particularly crucial in the Indian context where secured lending is preferred by financial institutions and is subject to specific regulatory requirements for creation and enforcement of security interests.

What sections should be included in a Secured Loan Agreement?

1. Parties: Identification of the lender and borrower with complete details including registration numbers, addresses

2. Background: Context of the loan arrangement, purpose, and basic transaction structure

3. Definitions: Definitions of key terms used throughout the agreement

4. Loan Amount and Purpose: Specification of the loan amount, purpose, and any tranching arrangements

5. Interest and Fees: Interest rate, calculation method, payment periods, and applicable fees

6. Repayment Terms: Repayment schedule, prepayment provisions, and payment mechanics

7. Security: Description of security interest, creation of charge, and perfection requirements

8. Conditions Precedent: Conditions that must be satisfied before loan disbursement

9. Representations and Warranties: Statements of fact and assurances given by the borrower

10. Covenants: Positive and negative obligations of the borrower during the loan term

11. Events of Default: Circumstances constituting default and consequences

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

13. Expenses and Indemnification: Cost allocation and indemnification obligations

14. Notices: Communication procedures and contact details

15. Governing Law and Jurisdiction: Choice of law and dispute resolution provisions

16. Miscellaneous: Standard boilerplate provisions including amendments, assignments, severability

What sections are optional to include in a Secured Loan Agreement?

1. Guarantee: Include when there are third-party guarantors for the loan

2. Insurance: Detailed insurance requirements when specific insurance coverage is required for secured assets

3. Security Trustee Provisions: Include when there are multiple lenders requiring a security trustee arrangement

4. Cross-Default: Include when the loan is part of a larger financing arrangement with cross-default implications

5. Tax Provisions: Detailed tax provisions when complex tax implications exist or for cross-border transactions

6. Currency Provisions: Include for loans involving foreign currency or multiple currency options

7. Subordination: Include when there are multiple creditors requiring subordination arrangements

8. Force Majeure: Include when specific force majeure provisions are required beyond standard contract frustration

What schedules should be included in a Secured Loan Agreement?

1. Schedule 1 - Security Assets: Detailed description of all assets provided as security

2. Schedule 2 - Repayment Schedule: Detailed amortization schedule with payment dates and amounts

3. Schedule 3 - Conditions Precedent Documents: List of all required documents and conditions for loan disbursement

4. Schedule 4 - Form of Disbursement Request: Template for requesting loan disbursements

5. Schedule 5 - Existing Security Interests: List of any pre-existing security interests on the security assets

6. Schedule 6 - Form of Compliance Certificate: Template for periodic compliance certifications

7. Schedule 7 - Security Documents: Forms of various security documents to be executed

8. Schedule 8 - Financial Covenants Calculations: Detailed methodology for calculating financial covenants

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

India

Publisher

Ƶ

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions
























































Clauses




































Relevant Industries

Banking & Financial Services

Real Estate & Construction

Manufacturing

Infrastructure

Technology

Healthcare

Retail

Agriculture

Energy & Utilities

Transportation & Logistics

Telecommunications

Mining & Minerals

Relevant Teams

Legal

Finance

Treasury

Risk Management

Compliance

Credit

Corporate Secretarial

Banking Operations

Business Development

Security Administration

Relevant Roles

Chief Financial Officer

Finance Director

Legal Counsel

Corporate Lawyer

Risk Manager

Credit Manager

Compliance Officer

Company Secretary

Treasury Manager

Banking Relationship Manager

Security Trustee

Loan Officer

Credit Analyst

Finance Manager

Chief Legal Officer

Business Development Manager

Industries









Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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