Kansas Second Mortgage Promissory Note
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FAQ
Borrower's promise to pay is secured by a mortgage, deed of trust or similar security instrument that is dated the same date as this Note and called the ?Security Instrument.? The Security Instrument protects the Lender from losses, which might result if Borrower defaults under this Note.
While all mortgage notes are promissory notes, not all promissory notes are mortgage notes. A promissory note is a legally binding promise from a borrower to repay a loan to their lender. A mortgage note is a document that outlines the terms of a mortgage.
Promissory notes may also be referred to as an IOU, a loan agreement, or just a note. It's a legal lending document that says the borrower promises to repay to the lender a certain amount of money in a certain time frame. This kind of document is legally enforceable and creates a legal obligation to repay the loan.
In fact, a promissory note may be a way for someone who is unable to obtain traditional financing to still buy a home through what is called a take-back mortgage. The financing vehicle effectively allows the home seller to loan a buyer money to purchase the home.
A promissory note is not essential for a mortgage loan. The terms of the loan can be effectively written through other legal documents standard to a loan. Whether your mortgage lender uses a promissory note will depend on their preferred forms.
A promissory note is a document between the lender and the borrower in which the borrower promises to pay back the lender, it is a separate contract from the mortgage. The mortgage is a legal document that ties or "secures" a piece of real estate to an obligation to repay money.
Only the borrower signs a promissory note, whereas both the lender and the borrower sign a loan agreement. Once the document is signed, it means that the borrower agrees to pay back the loan.