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Definition
A loan agreement is the legal document that sets out every term of a facility: the amount and drawdown mechanics, interest and fees, repayment schedule, any security, and the covenants and events of default.
In plain terms
The rate is one line; the risk lives in the covenants and default clauses. A cheap loan with tight covenants can be more dangerous than a slightly dearer, flexible one.
Why it matters for your company
Understand what could trip a default before you sign — a breached covenant can make the whole balance repayable on demand. Credicorp keeps business loan terms plain and covenant-light, with no personal guarantee on core products.
Related reading
Covenant
A covenant is a promise or condition written into a loan agreement that the borrower must keep to for the…
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Event of default
An event of default is any breach that lets a lender call in the loan — a missed payment, a broken covenant,…
Read →Security
In lending, security is an asset or legal claim a lender can enforce to recover its money if a borrower…
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Personal guarantee
A personal guarantee is a director's legally binding promise to repay a company's debt from their own money…
Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.