I have been assisting someone financially for some time. There are various amounts of money, sometimes $2,000, other times $5,000 however, it is very important to note that the money is BORROWED FROM ME and NOT A GIFT. The amount owed to me, so far, is well over $50,000 plus interest. The borrower has agreed to signing a personal promissory note with me securing all of the money he owes to me inclusive of future money he borrows with interest against his house. Again, the amounts of money loaned to him are numerous over the years and they are continuing and ongoing as the party is not physically well. Is there a way to write a legal promissory note securing his house for repayment of money he has and continues to borrow plus interest due me when there is no definitive amount at the time the promissory note is executed? Or, in the alternative can one secured promissory note be written explicitly with an amount as of present date followed by subsequent shorter addendums for new loans? I need to make certain that the promissory note is legally binding so that if he passes away, his children cannot challenge it. Thanks.
Yes, you can sign a credit line promissory note that provides for drawdowns that are listed on the attached schedule, and the note can be secured by a mortgage on the debtor's house. That is a relatively sophisticated transaction and should not be attempted at the assistance of an experienced New York Business Attorney.
The foregoing discussion does not establish an attorney-client relationship, is qualified by the limited facts presented above, and should not be relied upon as legal advice. To obtain definitive legal advice upon which one can rely necessitates retaining an attorney who is qualified in this particular area of the law.
Do not mess with this on your own. The penalty for not doing it correctly is too great, compared to the modest cost of having a local attorney prepare it. A note cannot be secured against a house. What you will need is a mortgage with that note. It is the mortgage which is the security and it needs to be properly filed with the county clerk. Do yourself a favor and consult a local attorney.
The above answers are excellent advice. Please note that there will be closing expenses regarding the mortgage you require. They include but are not limited to mortgage tax, recording fees, mortgage policy premium, & various searches relating to an insurable transaction.
Years licensed, work experience, educationLegal community recognition
Peer endorsements, associations, awardsLegal thought leadership
Publications, speaking engagementsDiscipline