A promissory note is a written promise to pay a debt. It is an unconditional promise to pay on demand or at a fixed or determined future time a particular sum of money to or to the order of a specified person or to the bearer.
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Interesting Questions
While it’s not absolutely necessary, having a lawyer help out can save a lot of heartache down the road. They can ensure everything is legally sound and tailored to your needs.
Absolutely! A secured promissory note is backed by collateral, which means if the borrower defaults, the lender can claim the asset. An unsecured note, on the other hand, isn’t backed by any asset.
If a borrower defaults, the lender has the right to take legal action to recover the owed amount, which might include seizing collateral if it was part of the agreement.
Yes, it can be modified, but both parties must agree to the changes and ideally put them in writing to avoid any misunderstandings later on.
It acts like a safety net for both sides. The lender gets assurance they’ll be repaid, while the borrower knows their obligations clearly laid out, reducing the chance of disputes.
Notarizing isn't always required, but it adds an extra layer of credibility and can help if any disputes arise down the line.
Absolutely! It’s a smart move to keep things clear and avoid any awkward conversations in the future.