Ready-to-Use Real Estate Loan for Use Agreement
This ready-to-use real estate loan for use agreement template helps parties record the temporary, rent-free use of a property. It includes identification of the parties, property details, term, permitted use, maintenance duties, return conditions and signature blocks for a clear written arrangement.
A real estate loan for use agreement records the temporary and rent-free use of a property by one party with the owner’s permission. It is commonly known in legal systems as a commodatum or gratuitous loan agreement. A written document helps establish the property involved, the intended use and the date on which it must be returned. This template can be adapted for a house, apartment, commercial unit or other real estate.
What a real estate loan for use agreement is
Under this arrangement, the owner or lawful holder lends a property to another person without charging rent. The borrower may occupy or use the premises only for the agreed purpose and must return them when the agreed term ends or when another valid termination event occurs.
Unlike a lease, the essential feature is that no rent is paid for the use of the property. The parties should avoid calling a payment “expenses” if it is actually intended as regular consideration for occupation, as this may affect the legal classification of the arrangement.
Parties and legal capacity
The agreement should identify the lender and borrower with their full legal names, addresses and reliable identification details. If a company, estate, co-owner or representative is involved, the person signing should have authority to bind that party.
Key information to include
A careful description reduces uncertainty and assists both parties if there is a disagreement. The agreement should state whether furniture, parking spaces, storage areas, keys, appliances or other items are included in the loan.
| Document field | Purpose | Frequent error |
|---|---|---|
| Property address and description | Identifies the exact premises being lent | Using only a general neighborhood description |
| Loan term | States when possession begins and ends | Leaving the return date unclear |
| Permitted use | Limits residential, business or storage use | Not addressing subletting or third-party use |
| Expenses and utilities | Allocates recurring and consumption costs | Confusing reimbursement with rent |
| Condition and inventory | Records the property’s state at handover | Failing to attach photos or an inventory |
Property condition and inventory
An inventory signed by both parties is particularly useful where the property is furnished. Photographs dated at handover and return can supplement the inventory and help distinguish normal wear from damage.
Obligations of the borrower
The borrower should use the property carefully, comply with applicable laws and community rules, and avoid changing the premises without written permission. The borrower should also notify the lender promptly of damage, urgent repairs or circumstances that could place the property at risk.
- Use the property only for the agreed purpose.
- Keep the premises reasonably clean and secure.
- Pay the utilities and expenses allocated in the agreement.
- Do not assign, sublet or allow unauthorized occupants without consent.
- Return keys, access devices and included items at the end of the loan.
Editable template
Document template
REAL ESTATE LOAN FOR USE AGREEMENT
Place: ____________________ Date: ____________________
This Real Estate Loan for Use Agreement (the “Agreement”) is entered into by and between:
Lender: ____________________, identification number ____________________, of address ____________________.
Borrower: ____________________, identification number ____________________, of address ____________________.
The Lender and the Borrower agree as follows:
| Variable field | Details |
|---|---|
| Property address | ____________________ |
| Property description / registration details | ____________________ |
| Permitted use | ____________________ |
| Start date | ____________________ |
| End date / return date | ____________________ |
| Utilities and expenses payable by Borrower | ____________________ |
| Included furnishings, keys and items | ____________________ |
- Loan of property. The Lender grants the Borrower temporary, gratuitous use of the property identified above. No rent is due under this Agreement.
- Purpose and possession. The Borrower shall use the property solely for ____________________ and shall not assign, sublet, transfer possession of, or permit use by third parties without the Lender’s prior written consent.
- Term. The loan begins on ____________________ and ends on ____________________. The Borrower shall return possession of the property on or before the end date, unless the parties agree otherwise in writing.
- Expenses. The Borrower shall pay the following utilities, consumption charges and ordinary expenses: ____________________. These payments do not constitute rent.
- Care and maintenance. The Borrower shall keep the property in reasonable condition, use it with due care and promptly notify the Lender of damage, defects or necessary urgent repairs.
- Alterations. The Borrower shall not make structural changes, improvements or alterations without the Lender’s prior written consent.
- Return of property. Upon termination, the Borrower shall vacate the property, return all keys and access devices, remove personal belongings and deliver the property in substantially the condition received, subject to ordinary wear and tear.
- Inventory. Any inventory, photographs or handover record signed by the parties forms part of this Agreement.
- Applicable law. This Agreement shall be governed by the laws of ____________________.
Signed by the parties on the date and at the place stated above.
____________________
Lender
Name: ____________________
____________________
Borrower
Name: ____________________
____________________
Witness (if applicable)
Name: ____________________
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Term, termination and return
The parties may set a fixed term, a return date or a notice-based arrangement where permitted by applicable law. They should clearly state the notice method, notice period and any situations allowing earlier termination, such as misuse, unauthorized occupation or serious breach.
At the end of the arrangement, the borrower should vacate the property, remove personal belongings and return it in substantially the same condition, subject to ordinary wear and tear. A written return receipt can confirm the date, condition and number of keys delivered.
Practical recommendation: sign an inventory and take dated photographs on the day the property is handed over and again when it is returned.
How to complete the template
Complete all blank fields before signing, and make sure both parties receive an identical copy. If the arrangement involves multiple owners, inherited property, a mortgage, local registration requirements or a long-term occupation, seek jurisdiction-specific advice.
- Identify the lender, borrower and property precisely.
- Specify the term, intended use and any notice requirements.
- Allocate utilities, maintenance tasks and repair responsibilities.
- Attach an inventory, sign the agreement and retain copies.
Frequently asked questions
Is a loan for use agreement the same as a lease?
No. A lease generally involves payment of rent for possession or use, while a loan for use is ordinarily gratuitous. Local law and the actual conduct of the parties may determine the legal nature of the arrangement.
Can the borrower pay utility bills?
Yes, the parties can allocate utilities and ordinary consumption expenses to the borrower. The agreement should state clearly that these payments are reimbursements or direct expenses rather than rent, where consistent with applicable law.
Should the agreement be notarized?
Notarization is not always required, but rules differ by jurisdiction and transaction. It may be useful for evidentiary purposes or when local law, a registry, a lender or another institution requires it.