Promissary Note Collection

[wcsc]

What is the name of your state? CALIFORNIA

I MADE A LOAN TO A FRIEND OF THE FAMILY ON NOV 8TH 2005 IN THE AMOUNT OF 40000.... WE MADE AN AGREEMENT AND HAD THIS NOTORIZED ...BUT AFTER A YEAR WITH NO PAYMENTS AND LENIENT EXCUSE TIME ..IT IS TIME FOR SOME ACTION TO GET MY MONEY BACK......

LOOKING FOR ANY ADVICE AS PERTAINING IF THERE IS STATUE OF LIMITATIONS ON COLLECTING THIS AND HOW MUCH DOES THIS PROMISSARY NOTE HOLD IF LEGAL ACTION TAKES PLACE...

THX FOR UR GUYS TIME U GUYS ARE THE GREATEST

RICH

[Ladynred]

Unlike so many others, you have a WRITTEN and signed agreement. That gives you much more leverage in court should you sue than someone who only has a verbal agreement. Chances are you'd win such a lawsuit pretty easily.

[Chien]

LNR’s observation is on point. As to the rest of your question, you have 4 years from date of default and, while you state the loan date, you don’t state the date that the first/full payment was due. You have to do the math.
As LNR says, with a signed agreement, you should have a solid case. However, nobody has seen the agreement, notarized or not. The amount in contention is large enough that, if you have to sue and your “friend” retains counsel, don’t try to go it alone. At least consult with an attorney, so that you don’t slip-up on your own. The same holds true if you need a payment agreement that’s enforceable. Then, if you do have to take a judgment, the hard part may be collecting.
(And there is no need for caps – we can read without figurative shouting.)

If he owns a home you can place the j.l. (judgement lien) on the home. It will not do much however he will never be able to sell or refinance until it is paid. If he does not have any real property...go for a wage garnishment. If you don't do anything thinking this is your friend then you lose all the way around. Also make sure you send a copy of the judgement to all 3 of his credit bureaus and keep renewing it every 5-7 yrs. He won't get a home with this j.l. still outstanding.


Why do people loan to friends or co sign for their kids?

[Chien]

If he owns a home you can place the j.l. (judgement lien) on the home. It will not do much however he will never be able to sell or refinance until it is paid. If he does not have any real property...go for a wage garnishment. If you don't do anything thinking this is your friend then you lose all the way around. Also make sure you send a copy of the judgement to all 3 of his credit bureaus and keep renewing it every 5-7 yrs. He won't get a home with this j.l. still outstanding.

Conceptually good advice, but a CA judgment is good for 10 years, and there is no point spending to renew before 9.5. Furthermore, the Big Three are not going to accept your report if you’re not a contractual user (and you’re not), but a judgment will be a public record and will automatically be picked-up for that reason.

Your judgment is going to be for $40K++ and will earn simple interest at 10% APR. Unless your “friend” is a hedge fund manager (and that seems doubtful if he borrowed $40K), you need to find some other means of enforcement besides wage garnishment. If your judgment were only for the $40K, you need to recover $333+/mo. just to cover yearly interest. If you could do that alone, the obligation would still be $40K in 10 years. Not much progress and you only get 1 renewal.

Finally, filing an Abstract to lien any real property should be considered mandatory, but you didn’t say he owns any and, even if he does, it doesn’t help you much if he goes bankrupt. You’re an unsecured judgment creditor and are more likely to see a discharge before you see dollars. Think of other ways and think larger and faster.

[wcsc]

thx everyone for the help..... i will be contacting a lawyer for the neccassary arrangements...... as always u guys are the best...

Chien is right, this has bankruptcy written all over it. Sorry

Good advise Chien...However I have seen judgements (private lenders) go onto credit reports when they report them. I have also "added" to bureaus alternative tradelines to get an automated approval for a deal. Such as utility payment history, verification of rent by merely faxing it to our credit reporting co. we use. It's pricey but effective to add these tradelines for those F.H.A. first time home buyer folks that don't have any otherwise...
Hard money private real estate investor's (individual's) it does not get their money back however does not help their credit any...either. If his friend is credit concience he will want this removed...

You are correct...with a judgement it will get picked up regardless when trying to buy, refinance ary real property

[Ladynred]

I have seen judgements (private lenders) go onto credit reports when they report them

This is more likely due to companies who pay college students to comb thru public records that they then sell to the CRA's than anything else.