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Review the terms and conditions of the credit agreement

Last updated on April 29, 2022

Receive a copy of the credit agreement

A lender must give you a credit agreement for any loan, which states:

  • The terms and conditions of the loan
  • All costs

You may be asked to sign a document or click a button to accept terms and conditions.

If you were not given a copy of the credit agreement, or the lender refuses to give you one:

  • Do not sign or agree to anything
  • Do not accept money from the lender

Review the credit agreement

Take time to review the credit agreement before you sign or agree to it. Ask questions if you do not understand something. For more information, review these tips on what to look for in a credit agreement.

Be sure to understand what you will pay for the loan in interest and fees. The credit agreement will describe this as the 'total cost of credit'.

Make sure you will be able to make the required payments. If you fall behind, you may:

  • Have part of your wages deducted
  • Lose an asset used for collateral
  • Be contacted by debt collectors

Pay attention to what can happen if you miss a payment. This can cost you additional money and negatively impact your credit rating.

Understand the risks and benefits before signing

Only sign a credit agreement if you:

  • Understand what you are agreeing to
  • Are prepared to fulfil the terms and conditions

If you are unsure about whether you are making the right decision, consider: