Family & Friend Loan Agreement FAQ (Canada)

About four minutes. You answer a few plain questions, send one secure link, and you both sign from your phones — no printing, no appointments.

No. You draft on your own for free, then send one secure link. The borrower reads the same document, signs from their phone, or asks for a change first.

Yes. You can choose monthly payments, a single lump sum, or flexible repayment by a deadline — and set the date that works for both of you.

You can create a new agreement that supersedes the old one, signed by both parties the same way. Keep both records so the change is clear.

Yes. Lend Right works for any private loan between individuals in Canada — friends, a partner, a coworker — not just family.

Yes. E-signatures are recognized federally and in every province for ordinary contracts like loan agreements. What makes one hold up is the proof around it — verified identity, timestamps, and evidence the document wasn't altered. That's exactly what the certificate provides.

An agreement can't force payment — it removes every escape hatch. In small claims court, a signed agreement with a verified signing record is the strongest evidence you can bring, and most provinces let you file without a lawyer (Ontario up to $50,000; Alberta $100,000).

A locked PDF of the agreement plus a signing certificate showing who signed, when, and proof the document wasn't altered — the evidence that holds up if you ever need it.

No. Lend Right is a self-help document tool — you make every decision; the software assembles lawyer-reviewed language and runs compliance checks. For complicated situations, talk to a lawyer.

A lawyer can advise on complex or high-value situations and tailor unusual terms — for those, use one. For an ordinary loan between family or friends, a Lend Right agreement covers the same essentials — parties, amount, repayment, interest, signatures — in plain language, checked against Canadian rules, with verified identity and a tamper-evident signing record. The difference is about four minutes instead of days, and $29 instead of $300–$600 or more.

Yes, optionally. We write the rate the legally correct way (annual disclosure included) and check it against Canada's 35% APR ceiling. Most family loans skip interest, and that's fine too.

Drafting is free for everyone. To finalise and certify a signed agreement is a one-time $29 — and it's free for you, the lender. The borrower covers the $29 as a thank-you for the trust, or you can pay it yourself.

It usually lands the opposite way. A clear agreement says "I take this seriously and I want us to stay good." Many borrowers are relieved — now they know exactly what's expected.

Yes. We verify the borrower's identity so you know exactly who you're lending to, and your signed record carries real weight.

The borrower is the person who owes the money, so confirming exactly who they are is what gives the signed agreement its weight if a dispute ever reaches court. The lender chooses the terms and signs from the account that created the agreement, which ties their identity to it. If you'd like both parties verified, email us and we'll enable it.

Nothing is binding until both people sign, so you're never locked in. If they hesitate, it usually means the terms need a quick conversation — they can request a change before signing. And since drafting is free, you've risked nothing if you decide not to proceed.

Your data is protected with bank-level security — encrypted in transit and at rest. The signed agreement is sealed with a tamper-evident record, and we never sell your information.

Identity is verified by Stripe Identity, a specialist provider trusted by thousands of companies. The check runs on their secure systems — Lend Right never stores your ID document or selfie. We only receive a verified pass and the borrower's confirmed legal name.

All of Canada's common-law provinces — Ontario, BC, Alberta, Manitoba, Saskatchewan, Nova Scotia, New Brunswick, Newfoundland & Labrador, PEI, and the territories. Quebec has its own civil-law system, so we're building it properly — coming soon.

No. A genuine loan is not income, so the borrower does not pay tax on the principal they receive. That's one of the main reasons to document it as a loan rather than a gift — a signed agreement is your evidence it was always meant to be repaid.

Yes. If you charge interest, the interest you receive is taxable income and must be reported on your Canadian tax return. An interest-free loan generates no interest income, so there's nothing to report. This is general information, not tax advice.

It's an income-splitting strategy: you lend to a spouse or family member at the CRA's prescribed interest rate, they invest the money, and investment returns above that rate are taxed in their hands instead of yours. The interest must actually be charged and paid by January 30 each year, and the rate is locked in for the life of the loan. For amounts that matter, confirm the details with an accountant.

Yes. With nothing in writing and no repayments, the CRA or a court may decide the money was really a gift — which can carry tax and legal consequences, especially around property and divorce. A signed agreement that names the parties, amount, and repayment terms is the clearest evidence that it was a loan.