Read the agreement as a set of future obligations

A loan agreement should make it possible to identify the creditor, the amount advanced, the cost and the complete repayment schedule. Check whether payments occur monthly, twice monthly or every two weeks; those calendars are not interchangeable. Read the provisions covering early repayment, payment changes, default, security and any guarantor. Keep the document you accepted, including attachments that contain fees or authorise account withdrawals.

Match each due date to an available income date

For loans from federally regulated institutions, the FCAC describes the information borrowers are entitled to receive. For a personal arrangement, People’s Law School explains how a written loan agreement can clarify expectations, with legal guidance specific to British Columbia. An informal conversation is a poor substitute for resolving unclear terms before money changes hands. Ask for ambiguous clauses to be explained in writing, particularly if a vehicle, home or another person’s finances may be exposed when repayments stop.

Understand what happens if the plan changes