The Default Loan Agreement is designed for use in South African lending transactions where parties need to establish clear terms for loan defaults and subsequent remedies. This template is particularly relevant in the context of South African credit law, which is primarily governed by the National Credit Act 34 of 2005 and related regulations. The document includes essential provisions for default scenarios, acceleration clauses, enforcement mechanisms, and mandatory consumer protection elements. It's structured to accommodate various lending scenarios while maintaining compliance with South African interest rate caps, fee limitations, and consumer protection requirements. The agreement is suitable for both corporate and consumer lending, with appropriate modifications based on the nature of the borrower and the transaction size.

1. Parties: Identifies and defines the Lender and Borrower with their full legal details

2. Background: Contextualizes the purpose of the loan and relationship between parties

3. Definitions and Interpretation: Defines key terms and establishes interpretation rules for the agreement

4. Loan Amount and Purpose: Specifies the principal amount and permitted use of the loan funds

5. Interest Rate: Details the applicable interest rate, calculation method, and compliance with NCA caps

6. Repayment Terms: Specifies repayment schedule, method, and timing of payments

7. Security: Details any security or collateral provided for the loan

8. Representations and Warranties: States the parties' confirmations about their capacity and authority

9. Borrower's Obligations: Lists ongoing obligations of the borrower during the loan term

10. Events of Default: Defines circumstances constituting default and consequences

11. Remedies: Outlines lender's rights and remedies upon default

12. Notices: Specifies how formal communications between parties should be made

13. General Provisions: Contains standard legal provisions including governing law and jurisdiction