With a loan agreement, the lender commits to delivering a specified amount of money or a certain quantity of other replaceable items to the borrower, who, in turn, commits to returning the same amount of money or the same quantity of items of the same type and quality after a specified period. The borrower acquires ownership rights over the received items. The loan agreement is a reciprocal and consensual contract.
The borrower may also commit to paying interest in addition to the principal. In commercial contracts, interest is due even if not expressly agreed upon.243 If the borrower is required to pay interest along with the principal, the agreement is considered a paid loan contract; otherwise, it is an interest-free loan. The repayment of the loan can be made in a lump sum or in instalments. If the parties to a commercial contract wish to agree on an interest-free loan, they must explicitly state this in the contract.244
The lender’s obligation is to deliver the agreed items at the specified time; if no deadline is set, then upon the borrower’s request.245
The borrower’s obligation is to return the same quantity of items of the same type and quality within the agreed period.
A special type of loan is a purpose-specific loan. This refers to a loan granted for a specific purpose, and the borrower may only use the borrowed funds for that designated purpose. If the funds are used for any other purpose, the lender has the right to withdraw from the agreement.246
