Before entering into a commercial loan agreement, the borrower first decides on his affairs concerning his character, his creditworthiness, his cash flow and all the guarantees he must put in collateral for a loan. These presentations are taken into account and the lender then determines the conditions under which they are willing to advance the money. Loan contracts between commercial banks, savings banks, financial companies, insurance companies and investment banks are very different from each other and all feed for different purposes. «Commercial banks» and «savings banks» because they accept deposits and take advantage of FDIC insurance, generate credits that include concepts of «public trust.» Prior to the intergovernmental banking system, this «public confidence» was easily measured by national banking supervisors, who were able to see how local deposits were used to finance the working capital needs of industry and local businesses and the benefits of the organization`s employment. «Insurance agencies,» which charge premiums for the provision of life, property and accident insurance, have entered into their own types of loan contracts. The credit contracts and documentary standards of «banks» and «insurance» evolved from their individual cultures and were regulated by policies that, in one way or another, met the debts of each organization (in the case of «banks,» the liquidity needs of their depositors; in the case of insurance organizations, liquidity must be linked to their expected «receivables»). «Investment banks» establish loan contracts that meet the needs of the investors they want to attract funds; «Investors» are still highly developed and accredited organizations that are not subject to bank supervision and the need to respect public trust. Investment banking activities are overseen by the SEC and the focus is on whether the parties providing the funds are properly or properly disclosed. Subject to section VI (B) limitations, the Authority may provide reasonable and necessary funds, interest and costs for performance and recovery, provided that insurance premiums are paid in full and all other conditions are met with the authorization or commitment of the credit insurance and loan insurance contract. Loan contracts are generally written, but there is no legal reason why a loan contract should not be a purely oral contract (although oral agreements are more difficult to enforce).

A loan agreement is a contract between a borrower and a lender that regulates each party`s reciprocal commitments. There are many types of loan contracts, including «easy agreements,» «revolvers,» «term loans,» working capital loans. Loan contracts are documented by a compilation of the various mutual commitments made by the parties. Loan contracts reflect, like any contract, an «offer,» «acceptance of offer,» «consideration» and can only relate to «legal» situations (a term loan contract involving the sale of heroin drugs is not «legal»). Loan contracts are recorded in their letters of commitment, agreements that reflect agreements between the parties involved, a certificate of commitment and a guarantee contract (for example. B a mortgage or personal guarantee).