March 2014

HSBC Bank Middle East Limited - PERSONAL LOAN AGREEMENT

HSBC Bank Middle East Limited

Personal Loan Agreement

Copyright. HSBC Bank Middle East Limited 2014 ALL RIGHTS RESERVED. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, on any
form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of HSBC Bank Middle East Limited.
Issued by HSBC Bank Middle East Limited, PO Box 66, Dubai, UAE. Regulated by the Jersey Financial Services Commission.

HSBC Bank Middle East Limited - PERSONAL LOAN AGREEMENT

PERSONAL LOAN AGREEMENT

This Agreement is dated the ........................................ day of ............................................................................. 20 ....................... , and made between HSBC Bank
Middle East Limited of PO Box 66 Dubai, UAE (the Bank) and ...................................................................................................................................................................................................
....................................................................................................................................................................... of P.O. Box ............................................................................................................................................................................................................................
......................................................................................................... (the Borrower) by which the Bank agrees to lend and the Borrower agrees to borrow
the sum of AED....................................................................... (in words ......................................................................................................................................................................................... ) (the Loan) upon
the terms set out below.
This is a Fixed Rate Loan Agreement, with a fixed monthly instalment comprising capital and a fixed rate of interest.
1.

Payment, Repayment and Fees

The Borrower undertakes, represents and warrants

for himself / herself, and for his/her heirs and/or
successors in title the following:

(a) To pay the Bank an arrangement fee of

which fee shall be paid by the Borrower on the
date of this Agreement.

(h) That the Bank has the right to claim full repayment
of the outstanding amount of the Loan at its
absolute discretion at all times for any reason
whatsoever.
(i)

..............................................

That on the date hereof and until the date of final

repayment of the Loan that:

..............

(b) To pay interest on Loan at the fixed rate of

% and to repay the Loan with interest in
monthly instalments on the
day of each calendar month. The first repayment
shall be AED
commencing
in the month of
or the month
following the drawdown, whichever is later
provided the first instalment date is within 45 days
from date of draw down.

(i) he/she is a natural person who is not

bankrupt;

(ii) he/she has the legal capacity to enter into

this Agreement and he/she has the financial
capacity to fulfill his/her obligations under this
Agreement;

(iii) this Agreement constitutes legally binding

obligations, enforceable against him/her in
accordance with its terms; and

(iv) he/she undertakes to transfer his/her salary to

the Bank.

.................................

................................

..........

.................................................................

.........................

................................................................................

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(c) To ensure that the credit balance on the Account

will be sufficient to meet the monthly instalment
as such sum falls due for payment. Debiting the
Account will not constitute any form of repayment
unless there are sufficient available funds in the
Account to meet such repayment.

(j)

(d) To transfer his/her monthly salary to the Bank

throughout the term of the Loan.
(e) To provide the Bank with a security cheque prior
to draw down for the full value of the Loan plus a
proportion of interest as notified to the Borrower by
the Bank at the time of application in accordance
with applicable laws and regulations.
(f)

To pay all applicable fees and charges as set out

in the Banks Schedule of Services and Tariffs as
amended and re-named from time to time (the
latest version of which will be available on the
Banks website www.hsbc.ae), including (but not
limited to) a prepayment fee on the outstanding
Loan amount if the Borrower partially or fully settles
the Loan.

(g) That any payments made into the Account are

subject to clearance. Until such payments are
cleared, the Bank may not be able to use such
monies towards the Loan repayment and will
continue to charge interest on outstanding Loan
repayments until there are sufficient monies in the
Account to settle such repayments.

That throughout the continuation of this Agreement

and so long as any sum is or may become payable
under this Agreement to supply to the Bank upon
request such information about his/her financial
position and affairs as the Bank may from time to
time require.

(k) To inform the Bank at least one month in advance

before the Borrower ceases to reside in the United
Arab Emirates.
2.

Payments

The Borrower agrees that:

(a) The instalment specified in Clause 1(b) above is
indicative only. The Borrower acknowledges that
the indicative instalment is acceptable and that
the exact instalment amount will be confirmed to
him at the time the funds are transferred to his
/ her bank account. The Borrower can check the
exact monthly instalment amounts by accessing
Personal Internet Banking and by using the payment
calculators on the personal loan pages of the Banks
website (www.hsbc.ae) and by checking his/her
monthly statement.
(b) The Bank may debit the monthly instalment to the
Borrowers Current/Savings* (delete as applicable)
Account number
(or
................................................................................................................

HSBC Bank Middle East Limited - PERSONAL LOAN AGREEMENT

accounts of the Borrower held by the Bank

or HSBC Holdings plc, its subsidiaries,
associated and affiliated companies, whether
held singly or jointly, against all monies
due under the Loan, the Bank may convert
the currency of any such credit as may be
necessary for this purpose;

any other account held with the Bank as notified

to the Bank by the Borrower from time to time)
(the Account) until the Loan together with any
outstanding interest is fully repaid.
(c) Draw down of the Loan is conditional upon the
Borrower transferring his/her salary to the Bank.
The Borrower agrees to continue to transfer his/her
salary to the Bank throughout the term of the Loan.
(d) If the Borrowers salary is credited to the Account
prior to the usual monthly instalment repayment
date in any given month then the number of
monthly installments corresponding to the amount
of months of the salary credit that has been paid
in advance will be immediately due and payable
and the Borrower agrees that Bank may use such
advance salary credit monies towards repayment of
those monthly instalments of the Loan.

3.

(iv) the Bank may enforce its rights under any

security held by the Bank in respect of
the liabilities of the Borrower under this
Agreement;

(v) the Bank is authorized to complete the date

on any security cheque held by the Bank and
present the security cheque for payment; and

(vi) the Bank may deduct such fees and charges

as applicable in the event of default (in
accordance with Clause 1(f) above).

Default

If:
(a) The Borrower fails to pay punctually any sum
payable under this Agreement or there is any other
breach by the Borrower of this Agreement; or

4.

Demand

Any claim, summons, advice or notice relating to

the Loan shall be deemed to have been duly given
to the Borrower if given in writing by recorded
delivery or registered post to the address of
the Borrower last known to the Bank. It is the
responsibility of the Borrower to advise the Bank of
any change of address.

5.

Statements

The Borrower undertakes to check all notifications

received from the Bank of amounts owing to
the Bank. If within thirty (30) days of the date
of dispatch of a notification of balance to the
Borrowers address as it appears in the records
of the Bank, no objection has been received from
the Borrower, then the balance shown therein
will be considered correct and the fact that no
communication has been received from the
Borrower will, subject to manifest error on the part
of the Bank, be confirmation of the correctness of
the account and the Borrower may not thereafter
raise any objection in respect of any such
notification of balance. The Borrower acknowledges
that should the Borrower not receive a notification
of balance for any period it is solely and entirely
the responsibility of the Borrower to demand a
statement of balance from the Bank.

6.

Indemnity

The Borrower hereby undertakes to indemnify

and release the Bank, and keep it so indemnified

(b) Any representation or warranty made by the

Borrower in Clause 1 or under or in relation to this
Agreement is or becomes incorrect; or
(c) The Borrower breaches any undertaking given in
Clause 1; or
(d) The Borrower dies; or
(e) The Borrower stops transferring his/her salary to the
Bank; or
(f)

The Borrower ceases to reside in the United Arab

Emirates; or

(g) The Bank makes demand for the full outstanding

amount of the Loan in accordance with its rights
under Clause 1(h) above
then the Borrower agrees that:

(i) all the outstanding Loan shall immediately

become due and payable by the Borrower
without any further notification thereof and
that the Borrower shall immediately pay to the
Bank the amount of such Loan together with
all commission, interest and any other sums
then due to the Bank under this Agreement or
otherwise;

(ii) the Bank may, at its absolute discretion,

declare the Loan terminated and no longer
available;

(iii) without prejudice to the right of the Bank

under this Agreement, the Bank may apply
any balance standing to the credit of any

HSBC Bank Middle East Limited - PERSONAL LOAN AGREEMENT

the Borrower must notify the Bank at least 5

working days in advance of either: 1) the day
the Borrowers salary is due to be credited to
the Account; or 2) the Borrowers usual monthly
repayment date, whichever is the earlier in any
particular month.

against all proceedings, costs (including legal

fees), liabilities, losses, expenses and damages
of whatsoever nature that the Bank may incur in
relation to the execution of this Agreement.

7.

Rights of set-off

(a) Payments by the Borrower pursuant to this

Agreement shall be made to the Bank without any
set-off, counter claim, withholding or condition of
any kind, save that if the Borrower is compelled by
law to make such withholding the sum payable by
the Borrower shall be increased so that the amount
actually received by the Bank is the amount it would
have received if there had been no withholding.
(b) The Borrower agrees that the Bank may at any
time and without notice or demand, combine and/
or consolidate all or any of the Borrowers existing
accounts (whether current, deposit, loan or of any
other nature and whether denominated in UAE
Dirhams or in any other currency and whether held
solely or jointly with others) with the Bank at any
of its branches, whether within the UAE or abroad,
and apply set-off or transfer any credit balance or
sum standing to the credit of any such account in
or towards satisfaction of any of the Borrowers
obligations or liabilities (including those in relation
to the Loan) of whatever nature, whether actual
or contingent, as principal or surety, and whether
solely or jointly with any other person. Where
such set-off or transfer requires conversion of one
currency into another currency such conversion
shall be calculated at the Banks then prevailing rate
of exchange as determined by the Bank.

8.

Payment Holidays

(a) A payment holiday means the ability to defer

payment of any one of the usual monthly payments
of the Loan (Payment Holiday). The deferred
payment will become due and payable at the
end of the term of the Loan and the term of the
Loan will be extended by the number of months
corresponding to the number of monthly payments
deferred.
(b) The Borrower is entitled to request up to two
Payment Holidays in each year. The Bank at its sole
discretion may reject any request for a Payment
Holiday by the Borrower taking into account all of
the circumstances of the Borrower at the time of
the request.
(c) The Borrower is not entitled to request a Payment
Holiday in the first 6 months of the term of the Loan
and must have paid at least 6 consecutive monthly
instalments in full before taking their first Payment
Holiday.
(d) If the Borrower wishes to take a Payment Holiday,

(e) Payment Holidays cannot be taken consecutively.

(f)

The Borrower acknowledges that taking a Payment

Holiday will mean that more interest will become
payable over the term of the Loan, since the capital
portion of the Loan will not be paid down as quickly
(because the deferred instalment is payable at the
end of the term of the Loan). In addition, the final
instalment of the Loan may be higher than the
Borrowers usual monthly instalment (to take into
account the interest calculation) and the Borrower
agrees to pay any amount over and above his/her
usual monthly instalment at the end of the term
of the Loan. The Borrower further acknowledges
that taking a Payment Holiday shall not change any
of the other terms and conditions that govern the
Loan.

(g) For renewable 12 month Loans (12 Month

Loan), the deferred payment will become due
and payable at the end of the initial 12 month term
(or, if the 12 Month Loan has been renewed, the
renewed 12 month term) of the 12 Month Loan and
the initial 12 month term (or renewed 12 month
term, if the 12 Month Loan has been renewed)
of the 12 Month Loan will be extended by the
duration of the number of deferred payments. In
the penultimate month of the extended term (or
renewed term, as applicable), the Bank will contact
the Borrower to ask if the Borrower would like to
renew the 12 Month Loan in accordance with the
usual terms and conditions of renewals.
(h) Additional terms related to Payment Holidays may
apply at the time of availing the Payment Holiday.
Fees and charges relating to taking a Payment
Holiday may apply. The Borrower agrees that the
Bank may debit such fees and charges from the
Account.
(i)

The Borrower acknowledges that the Loan will not

be fully paid off until all deferred instalments have
been repaid in full and that the Bank will include any
deferred instalments on any liability letter issued in
relation to the Loan.

(j)

If the Borrower opts to fully settle the Loan before

the expiry of the term, the Borrower will be liable
to pay any deferred installment(s) at the point of
settlement. Fees and charges for early settlement
may apply.

(k) The Borrower acknowledges that requesting a

Payment Holiday shall not change any of the other
terms and conditions that govern the Loan.

HSBC Bank Middle East Limited - PERSONAL LOAN AGREEMENT

9.

Death

In the event of the Borrowers death:

(a) the outstanding Loan amount shall become

immediately due and payable;
(b) this Agreement will remain valid and will bind the
Borrowers estate (or heirs and successors);
(c) the Bank needs to be informed promptly of the
Borrowers death by the Borrowers estate (or
heirs and successors) and provided with a certified
copy of the Borrowers death certificate (or any
other supporting documentation that the Bank may
request at its discretion);
(d) the Borrowers estate (or heirs and successors)
will be responsible for paying the outstanding Loan
amount in full and shall keep the Bank indemnified
from all costs and expenses including legal fees on
a full indemnity basis) that the Bank may incur in
recovering the outstanding Loan amount.

(d) No failure to exercise, nor any delay in exercising,

on the part of the Bank of any right or remedy
hereunder shall operate as a waiver thereof. The
rights and remedies of the Bank herein provided are
cumulative and not exclusive of any other rights or
remedies it may have.
(e) The Borrower hereby acknowledges that he/she
have read this Agreement, that he/she understands
and agrees to the obligations, liabilities and rights as
mentioned therein whether set out in English and/
or Arabic and that he/she has received an unsigned
copy hereof.

11. Your Information

The Bank will treat all of the Borrowers personal

information as private and confidential. Nothing
about the Borrowers relationship with the Bank or
the Borrowers name and address will be disclosed
to anyone, other than in accordance with the
Personal Banking General Terms and Conditions,
which are incorporated into this Loan Agreement.

10. Miscellaneous
(a) The Borrower hereby authorises the Bank to sell
or realize as it sees fit any and all securities held
by it in order to repay the Loan together with all
commissions, interest and any other sums due to
the Bank. The Borrower shall remain responsible to
the Bank for any shortfall.
(b) Upon request by the Borrower, any 12 Month Loan
may be automatically renewed by the Bank for up
to twelve months at a time for a maximum of three
times at the Banks sole discretion, subject to the
Borrower continuing to meet the Banks eligibility
criteria, due diligence requirements and providing
any new documentation/ further information which
may be required by the Bank. The maximum term
of the 12 Month Loan following renewals may be
four years. Upon renewal the interest rate, charges,
fees and terms of borrowing may be different and
the Bank will inform the Borrower of such changes
if this is the case.
(c) If any change in law or circumstances occur which
the Bank at its sole discretion considers affects
this Agreement, and if the Bank and the Borrower
cannot agree changes to this Agreement to cover
such change in law or circumstances the Borrower
shall on demand repay the Loan and all other
amounts then due to the Bank hereunder.

12. Governing Law and Jurisdiction

This Loan Agreement is governed by the Federal

laws of the United Arab Emirates, as applied in the
Emirate of Dubai. The parties agree to submit to the
non-exclusive jurisdiction of the non-DIFC courts of
Dubai.

For and on behalf of

HSBC Bank Middle East Limited

Signature and Date

Borrower:

Signature and Date

Copyright. HSBC Bank Middle East Limited 2014 ALL RIGHTS RESERVED. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, on any
form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of HSBC Bank Middle East Limited.
Issued by HSBC Bank Middle East Limited, PO Box 66, Dubai, UAE. Regulated by the Jersey Financial Services Commission.