It Depends - Posted by Bill K. (AZ)
Posted by Bill K. (AZ) on March 10, 2000 at 17:30:38:
It really depends on what you’re trying to accomplish with this “letter”. As you read on, keep in mind that I’m not an attorney. However, I have borrowed and loaned money in the manner you describe many, many times over the years.
Does your dad want to be secured by the property in order to foreclose if necessary? If so, you’ll need him to become a lienholder. With this, you’ll want to get the document notarized so that it can be recorded. An attorney or title company should be able to help you prepare these forms, and record it, for a small fee.
Does your dad just want a promissory note from you to guarantee repayment? This would be a contract between the two of you that does not need to be notarized. In this case, your dad has no specific recourse against the property, just against you. Although, you may choose to sell the place to get him his cash.
Either one of these documents is not difficult to create. There are free forms available on the internet. Many of mine are just whipped up on the computer. Here’s what mine have included:
- Date of the contract.
- Your names
- Reason for the loan
- The terms of repayment
Finally, I see no reason for you to get a statement from your dad’s bank to prove he has the money. You shouldn’t enter into this contract until you get the money personally, or it gets held in escrow and released to you as repairs are made.
I hope this helps.
Bill K. (AZ)