What do I have to do to make a person personally liable for money that I lend them? Is there a document online I can download and have them fill out?
2007-02-16 14:02:42 · 7 answers · asked by ? 3 in Business & Finance ➔ Personal Finance
Complete a Promissory Note. You can find them in print at an office supply store that has legal forms or you can buy legal software that includes it. You dont have to have it notarized, but it would probably be a good idea if a notary is available. If not have it witnessed by two people.
Be sure to include in the Promissory Note all of the information you can. Such as interest rate, late charges, liability for legal fees and debtors responsibility to notify you of address and phone number changes
2007-02-16 14:31:05 · answer #1 · answered by Pinky Lee 2 · 0⤊ 0⤋
If I wanted to draw something that would stand up in court I would use a standardized form. Stationary stores often stock forms like this. You can also get the form from www.prepaidlegal.com. If you have the membership too, you can have an attorney look it over.
It really isn't difficult, I've signed several of these with my father as the documents protect both of us from excessive gift taxes. If you have trust issues, make sure it's notorized and I suggest an abritration agreement if there's any chance you might need the courts for collection activities. It would be less expensive if things go wrong. Good luck.
2007-02-16 22:38:52 · answer #2 · answered by CJ 2 · 0⤊ 0⤋
The document you are looking for is called a Promissory Note.
It is also a great idea to obtain the borrower's Social Security Number. This way, a judgment obtained in court, if necessary (in the event of borrower default), is enforceable via the credit bureaus. Also, in the event of default, with the borrower's SSN, you can properly create and submit a Form 1099-MISC, Miscellaneous Income, documenting to the I.R.S. after the end of the calendar year the income the borrower received from you so that they pay income tax on it, and YOU pay less income tax since you would have a business loss that is deductible on Line 12 of the front side of your Form 1040. Try Nolo Press for the legal form.
2007-02-16 22:47:10 · answer #3 · answered by JackN 3 · 0⤊ 0⤋
You're not required to use a particular form, only that you include enough details to make it legally binding. If you want some help, though, try the Legal Zoom web site below and go to "promissory note". This site sells all sorts of legal forms, and they'll sell you the form you need on-line for $9.99. Might be worth the peace of mind. Good luck.
2007-02-16 22:24:16 · answer #4 · answered by Marko 6 · 0⤊ 0⤋
just write it down on paper and both of you should sign it.
even better would be to get a third person to sign and say they witnessed this loan and contract signing take place.
no fancy legal stuff required, just a self-handwritten contract and the signature of all parties is all that is required
2007-02-18 15:06:04 · answer #5 · answered by Deku 2 · 0⤊ 0⤋
go to a notary, have that person write on a piece of paper write their name and state that hey owe you (your name) so much money and promise to pay it back by a certain date, and they are are personally liable for it. have them sign it, you sign it, date and notary will legalize it for a small fee.
2007-02-16 22:12:16 · answer #6 · answered by jpcjulia 4 · 0⤊ 0⤋
No, you can write one up on your own. I would recommend having a lawyer look over it and then have it notarized after you both sign it.
2007-02-16 22:11:12 · answer #7 · answered by somathus 7 · 0⤊ 0⤋