Document background
The Loan Agreement Between Lender Borrower And Guarantor is a crucial document used in Saudi Arabian financial transactions where additional security is required for loan facilities. This agreement is particularly relevant when the lender requires extra assurance beyond the borrower's primary obligations, typically in situations involving substantial loan amounts or when the borrower's creditworthiness needs enhancement. The document must strictly comply with Sharia principles and Saudi Arabian banking regulations, including SAMA guidelines. It comprehensively details the roles and obligations of all three parties, incorporating Islamic finance structures, profit-sharing mechanisms (instead of conventional interest), and enforcement provisions. The agreement is commonly used in both commercial and personal financing scenarios, requiring careful consideration of Saudi Arabian commercial law, banking regulations, and Sharia compliance requirements.
