Oklahoma Loan Agreement

Q: What is a loan agreement in Oklahoma?

A loan agreement is a written contract in which a lender lends money to a borrower who promises to repay it, usually with interest, on an agreed schedule. In Oklahoma it should name the parties, the principal, the interest rate as a number, the repayment dates, any late fee, and what counts as default. Because Oklahoma's constitution treats a private contract rate above 10 percent per year as usurious (Article 14, Section 2) and fills a blank rate at 6 percent, stating the rate in writing matters. A written contract can be enforced for five years.

Q: What is the maximum legal interest rate in Oklahoma?

For a private lender the ceiling is generally 10 percent per year. Oklahoma Constitution Article 14, Section 2 provides that, absent legislation fixing a higher maximum, a contract for more than 10 percent per year is usurious, and where no rate is agreed the rate may not exceed 6 percent. Licensed supervised lenders under the Uniform Consumer Credit Code may charge more, but a private lender who is not licensed should keep a loan at or below 10 percent.

Q: Is a written loan agreement required in Oklahoma?

A loan does not have to be in writing to be enforceable in Oklahoma, but writing it down is strongly advised. A written agreement is required to set an agreed rate above the 6 percent default, up to the 10 percent ceiling (15 O.S. Section 266). A written contract also carries a five-year limitations period to sue (12 O.S. Section 95), so a signed agreement protects both sides if the loan is later disputed.

Q: Do I need a license to lend money in Oklahoma?

Not for a one-off private loan. Oklahoma's Uniform Consumer Credit Code (Title 14A) requires a license, from the Department of Consumer Credit, only of a person engaged in the business of making supervised loans, meaning consumer loans with a finance charge over 10 percent per year. A consumer loan is one made by a person regularly engaged in the business of lending, so an individual making an occasional personal loan generally does not need a license. A repeat lender should confirm licensing.

Q: What is the penalty for usury in Oklahoma?

Charging more than the lawful rate is usurious. Under Oklahoma Constitution Article 14, Section 3, a knowing usurious charge forfeits the entire interest, and a borrower who paid it may recover twice the interest paid (if suit is brought within two years). The safest course is to keep a private loan at or below 10 percent per year (Article 14, Section 2) unless you are a licensed supervised lender, and to state the agreed rate in the written Oklahoma loan agreement.

Q: Can I charge a late fee on a loan in Oklahoma?

Yes, if the fee is reasonable. Oklahoma does not set a flat statutory late-fee cap on a private written loan, though the Uniform Consumer Credit Code sets specific limits for licensed consumer loans. Tie any late fee in an Oklahoma loan agreement to the real cost of a late payment rather than an arbitrary penalty, and state the grace period and the fee clearly in the contract.

Q: How long do I have to sue on an unpaid loan in Oklahoma?

For a written loan agreement you generally have five years from the default (or from the last payment or written acknowledgment of the debt) to sue in Oklahoma (12 O.S. Section 95). Because the period runs from breach and a signed writing is easy to prove, keeping a written, dated Oklahoma loan agreement gives you the stronger position if you have to collect.

An Oklahoma loan agreement sets the loan terms; the constitution treats a private contract rate above 10 percent per year as usurious.

Find out where you stand in Oklahoma

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Introduction

A loan agreement in Oklahoma is the written contract that binds a lender's advance to a borrower's promise to repay with interest, a rate the state constitution treats as usurious once it climbs above 10 percent per year for a private lender. In Oklahoma the interest a private lender can charge is limited by the state constitution. Article 14, Section 2 of the Oklahoma Constitution provides that, absent legislation fixing a higher maximum, a contract for a rate greater than 10 percent per year is usurious, and where no rate is agreed the rate may not exceed 6 percent per year. The state statute agrees: 15 O.S. Section 266 sets the legal rate at 6 percent absent an agreed rate and lets the parties agree to any rate authorized by law. The Uniform Consumer Credit Code authorizes licensed supervised lenders to charge more than 10 percent on consumer loans, so a private lender who is not a licensed supervised lender should keep a loan at or below 10 percent. Making an occasional private loan does not by itself require a license: Title 14A requires a license only of a person engaged in the business of making supervised loans (consumer loans over 10 percent per year). Once the rate is set, a sound Oklahoma loan agreement names the parties, the principal, the interest rate as a number, the repayment schedule, any late fee, and what counts as default. It should include an acceleration clause, which lets the lender demand the entire unpaid balance at once if the borrower misses payments. Put the terms in writing: a written contract can be enforced for five years (12 O.S. Section 95), and a clear signed agreement is what protects both sides if the loan is later disputed. DocDraft builds your Oklahoma loan agreement from your facts, with attorney review available before you sign.

Key Things to Know

1
At its core, a loan agreement documents an Oklahoma loan's amount, its repayment schedule, and its interest rate, which a private lender should keep at or below the constitutional limit of 10 percent per year.
2
Oklahoma's constitution caps a private contract rate at 10 percent per year. Under Article 14, Section 2, absent legislation fixing a higher maximum, a contract for a greater rate than 10 percent per year is usurious. A private lender who is not a licensed supervised lender should keep a loan at or below 10 percent.
3
If no rate is agreed, the legal rate is 6 percent per year (Oklahoma Constitution Article 14, Section 2; 15 O.S. Section 266). To charge more than 6 percent, up to the 10 percent ceiling, state the agreed rate in a written agreement.
4
Licensed lenders may charge more. The Uniform Consumer Credit Code (Title 14A) authorizes licensed supervised lenders to charge more than 10 percent on consumer loans, which is why a licensed lender can lawfully exceed the constitutional ceiling while a private individual cannot.
5
You do not need a license to make an occasional private loan. Title 14A requires a license only of a person engaged in the business of making supervised loans (consumer loans with a finance charge over 10 percent per year); a consumer loan is one made by a person regularly engaged in the business of lending, so a one-off private loan is outside the requirement.
6
Put the loan in writing and keep it. A lawsuit on a written contract must generally be filed within five years in Oklahoma (12 O.S. Section 95). A written, signed agreement is required to set an agreed rate above 6 percent and is far easier to enforce.
7
Spell out default and acceleration. Define what counts as default (usually a missed payment past a stated grace period), and include an acceleration clause so the lender can demand the entire unpaid balance at once if the borrower defaults.

Key decisions before you file

Before you file a Loan Agreement in Oklahoma, a few decisions shape the document: which option to choose and what each one means. The Loan Agreement guide walks through them.

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OKLAHOMA LOAN AGREEMENT (Written loan of money with interest and repayment terms; Oklahoma law)

PARTIES. This Loan Agreement is made on [DATE] between [LENDER NAME], of [ADDRESS] (Lender), and [BORROWER NAME], of [ADDRESS] (Borrower).
LOAN AMOUNT (PRINCIPAL). Lender agrees to lend, and Borrower agrees to repay, the principal sum of [AMOUNT IN WORDS] dollars ([AMOUNT]).
INTEREST. The unpaid principal bears interest at [NUMBER] percent per year. In Oklahoma a private contract rate above 10 percent per year is usurious absent authorizing legislation (Oklahoma Constitution Article 14, Section 2), unless the Lender is a licensed supervised lender. If this agreement is left blank as to rate, the legal rate is 6 percent per year (Article 14, Section 2; 15 O.S. Section 266). Keep a private loan at or below 10 percent unless you are licensed.
REPAYMENT. Borrower shall repay the loan by [ ] a single payment of [AMOUNT] due on [DATE]; or [ ] [NUMBER] equal installments of [AMOUNT] each, due on the [DAY] of each month starting [DATE] until paid in full. Payments apply first to accrued interest, then to principal.
PREPAYMENT. Borrower may prepay all or part of the principal at any time without penalty, and interest stops accruing on any amount prepaid.
LATE FEE. If a payment is more than [NUMBER] days late, Borrower shall pay a late charge of [AMOUNT], which the parties agree is a reasonable estimate of Lender costs from the late payment and not a penalty.
DEFAULT. Borrower is in default if a payment is more than [NUMBER] days late, if Borrower breaks any promise in this agreement, or if Borrower becomes insolvent or files for bankruptcy.
ACCELERATION. On default, Lender may declare the entire unpaid balance of principal and accrued interest immediately due and payable, after any notice and cure period stated here: [NOTICE TERMS].
COLLECTION COSTS. If the loan is placed for collection, Borrower shall pay Lender reasonable collection costs and attorney fees to the extent permitted by law.
SECURITY. This loan is [ ] unsecured; or [ ] secured by the following collateral: [DESCRIBE]. Any collateral is governed by a separate security agreement.
GOVERNING LAW. This agreement is governed by the laws of the State of Oklahoma.
ENTIRE AGREEMENT. This writing is the entire agreement between the parties and may be changed only in a writing signed by both.

Executed on [DATE].

[LENDER NAME], Lender

[BORROWER NAME], Borrower

Note: This is a plain Oklahoma loan-agreement skeleton for a private written loan. An individual making an occasional loan is generally not required to hold a license; a person engaged in the business of making supervised loans (consumer loans over 10 percent per year) needs a license under the Uniform Consumer Credit Code (Title 14A). Keep a private loan at or below 10 percent per year unless you are a licensed supervised lender (Oklahoma Constitution Article 14, Section 2), and keep the signed agreement, because a lawsuit on a written contract must be filed within five years (12 O.S. Section 95). For the complete builder and other states, see the full Loan Agreement template hub.

Oklahoma Requirements for Loan Agreement

Maximum Interest Rate (Usury Ceiling)
Oklahoma's constitution caps a private contract rate at 10 percent per year. Under Article 14, Section 2, absent legislation fixing a higher maximum, a contract for a greater rate than 10 percent per year is usurious. A private lender who is not a licensed supervised lender should keep a loan at or below 10 percent, and state the rate as a number in the agreement.
Legal Rate When the Contract Is Silent
If no rate is agreed, Oklahoma applies the legal rate of 6 percent per year (Oklahoma Constitution Article 14, Section 2; 15 O.S. Section 266). To charge more, up to the 10 percent ceiling for a private loan, the parties must state the agreed rate in a written agreement. Always write the agreed rate into the agreement so the 6 percent default does not apply by accident.
Licensed Lenders May Exceed 10 Percent
The 10 percent constitutional ceiling binds private lenders, not licensed supervised lenders. Under the Uniform Consumer Credit Code (Title 14A), a licensed supervised lender may charge more than 10 percent on consumer loans. This is why a licensed lender can lawfully exceed the ceiling while a private individual cannot. Confirm your status before setting a rate above 10 percent.
Lender Licensing (Consumer Credit Code)
Oklahoma's Uniform Consumer Credit Code (Title 14A) requires a license, from the Department of Consumer Credit, only of a person engaged in the business of making supervised loans, meaning consumer loans with a finance charge over 10 percent per year. A consumer loan is one made by a person regularly engaged in the business of lending, so an individual making an occasional private loan generally does not need a license. A repeat lender should confirm licensing.
Usury Penalty
Charging a knowingly usurious rate in Oklahoma forfeits the entire interest on the loan, and a borrower who paid it may recover twice the interest paid if suit is brought within two years (Oklahoma Constitution Article 14, Section 3). Keep a private loan at or below 10 percent per year unless you are a licensed supervised lender, and state the agreed rate in the written agreement so you can show the loan was within the lawful limit.
Late Fees Must Be Reasonable
Oklahoma does not set a flat statutory late-fee cap on a private written loan, though the Uniform Consumer Credit Code sets specific limits for licensed consumer loans. A late charge on a private loan should be a reasonable estimate of the lender actual costs from a late payment, not a penalty. State the grace period and the fee clearly in the Oklahoma loan agreement.
Default and Acceleration
Define default clearly, usually a payment missed past a stated grace period, a broken promise in the agreement, or the borrower insolvency. Include an acceleration clause so that on default the lender may declare the entire unpaid balance of principal and accrued interest immediately due. Stating any required notice and cure period avoids disputes about whether acceleration was proper.
Time Limit to Sue on the Debt
A lawsuit to collect on a written loan agreement must generally be filed within five years in Oklahoma, running from the default or from the last payment or written acknowledgment of the debt (12 O.S. Section 95). Keeping a signed, dated written agreement gives the longer, easier-to-prove period if you have to collect.

Frequently Asked Questions

What is a loan agreement in Oklahoma?

What is the maximum legal interest rate in Oklahoma?

Is a written loan agreement required in Oklahoma?

Do I need a license to lend money in Oklahoma?

What is the penalty for usury in Oklahoma?

What interest applies if my loan agreement is silent in Oklahoma?

Can I charge a late fee on a loan in Oklahoma?

How long do I have to sue on an unpaid loan in Oklahoma?

Find out where you stand in Oklahoma

Introduction

Key Things to Know

Key decisions before you file

Customize your Loan Agreement Template with DocDraft

Oklahoma Requirements for Loan Agreement

Maximum Interest Rate (Usury Ceiling)

Legal Rate When the Contract Is Silent

Licensed Lenders May Exceed 10 Percent

Lender Licensing (Consumer Credit Code)

Usury Penalty

Late Fees Must Be Reasonable

Default and Acceleration

Time Limit to Sue on the Debt

Frequently Asked Questions