Lending money, contract, default.

[Badad]

Iowa:

I would like to lend my old friend Chris enough money to kick start a auto-body business. Can we legally write up a contract stating terms, interest rate etc? Chris is willing to put the deed of the property in my possession in case he defaults, cant pay back the loan. I dont want his property, but I need some sort of guaranteed collateral just in case..

How/can we write up a binding contract? And should we use two lawyers?

Thanks for the advice.

 

[Zigner]

I would suggest that you consult with a business attorney about this matter, as I suspect you are talking about a not-small amount of money. I would like to ask (rhetorically) why you think that having the deed in your possession will do anything for you. The piece of paper is not what gives rights, it simply memorializes the rights that a property holder has.

 

[racer72]

If you can't afford to lose the money, don't loan it. Problem solved.

 

[Badad]

I would like to ask (rhetorically) why you think that having the deed in your possession will do anything for you. The piece of paper is not what gives rights, it simply memorializes the rights that a property holder has.

Thanks for pointing that out.

I guess I'm just asking if a binding contract could be written up by a business attorney to ensure his property as collateral just in case?

Promissory Note and mortgage.

 

[tranquility]

Yes, you can secure the debt. You will not do it properly on your own so will need an attorney.