Promissory Note-failure to pay

What is the name of your state?What is the name of your state? California

I lent $2,500 to an individual. He had approached me with the idea of borrowing $2,500 and repaying an additional $1,250 as an inducement. He signed a promissory note with the agreement that he would pay $1,250 on 6/1/05; $1,250 on 7/1/05, and $1,250 on 8/1/05. He has been late from the first month, and has had an excuse each time. I finally have recouped my original $2,500 but am still due the last $1,250.

The promissory note states that upon default the note is due and payable.

What recourse do I have? What should be the next step?
Thank you.

greenrunning said:

What is the name of your state?What is the name of your state? California

I lent $2,500 to an individual. He had approached me with the idea of borrowing $2,500 and repaying an additional $1,250 as an inducement. He signed a promissory note with the agreement that he would pay $1,250 on 6/1/05; $1,250 on 7/1/05, and $1,250 on 8/1/05. He has been late from the first month, and has had an excuse each time. I finally have recouped my original $2,500 but am still due the last $1,250.

The promissory note states that upon default the note is due and payable.

What recourse do I have? What should be the next step?
Thank you.

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My response:

None. Want to know why?

IAAL

Yes, please tell me why?

greenrunning said:

Yes, please tell me why?

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My response:

Okay. It's because you violated the California Constitution! You hit the big time with that one, pal. California law limits the amount of interest that may be charged for any "loan or forbearance of money." [Ca Const. Art. XV, § 1] "Usury" is the charging of interest for "any loan or forbearance of money" in excess of the statutory maximum. [Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 798, 35 Cal.Rptr.2d 418, 423]

The maximum interest rate for consumer loans is 10% per annum. [Ca Const. Art. XV, § 1(1)]

In short, there's no court in California that would grant you $1,250.00 interest on a $2,500.00 loan. You blew it.


IAAL

Promissory Note

I understand what you're saying but it was this individual who came up with the amount of interest-not me. He approached me with this offer. Are you saying I was had? and that he knew he could never be forced to repay even though it was his offer? Thank you.

greenrunning said:

I understand what you're saying but it was this individual who came up with the amount of interest-not me. He approached me with this offer. Are you saying I was had? and that he knew he could never be forced to repay even though it was his offer? Thank you.

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My response:

I don't care who came up with the offer. It's a contract that is void on it's face - - void ab initio - - void right from the start. It's unenforceable.

So, yes, you were "had." I don't know if he knew at the inception or found out later on. It doesn't matter, though.

You're lucky you received the principle amount.

IAAL