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Can they do that? Promisory Note

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D

DawnL

Guest
I signed a Promissory note that stated a 10% annual interest rate from a bank that stated
" Payment due on demand, if no demand is made, $600 / mth beginning on 03/01/99. I have made my payments on time. I got a letter from them in 1/2000 that said they were goin to raise my interest rate to 11%. I thought they made a mistake so I ignored it and kept paying 600/mth. Then I got another letter in janruary of this year that said the interest would raise to 12.75%. The asked me to sign a piece of paper consenting to this interest increase and of course I didn't. Now they said that the balance of the note is payable on demand. They want me to pay it all now. Can they do this??
 


I AM ALWAYS LIABLE

Senior Member
DawnL said:
I signed a Promissory note that stated a 10% annual interest rate from a bank that stated
" Payment due on demand, if no demand is made, $600 / mth beginning on 03/01/99. I have made my payments on time. I got a letter from them in 1/2000 that said they were goin to raise my interest rate to 11%. I thought they made a mistake so I ignored it and kept paying 600/mth. Then I got another letter in janruary of this year that said the interest would raise to 12.75%. The asked me to sign a piece of paper consenting to this interest increase and of course I didn't. Now they said that the balance of the note is payable on demand. They want me to pay it all now. Can they do this??
My response:

What part of "Payment due on demand" is unclear to you?

IAAL
 
D

DawnL

Guest
The part that was unclear was the increase in the interest rate. They cannot raise the interest rate on me.
 

I AM ALWAYS LIABLE

Senior Member
DawnL said:
The part that was unclear was the increase in the interest rate. They cannot raise the interest rate on me.
My response:

Is there anything in the "Note" concerning interest rate increase or decrease ?

If not, under what "authority" are they citing to you for their actions?

IAAL
 
D

DawnL

Guest
The note said provided for a " 10% annual interest rate."
They did not give a reason for the increase in the interest rate. When it says annual, does that mean they can increase or decrease it after each year? The raised it to 11% in 2000, and 12.75% in 2001. Thanks so much for your help.
 

I AM ALWAYS LIABLE

Senior Member
DawnL said:
The note said provided for a " 10% annual interest rate."
They did not give a reason for the increase in the interest rate. When it says annual, does that mean they can increase or decrease it after each year? The raised it to 11% in 2000, and 12.75% in 2001. Thanks so much for your help.
My response:

Okay, we're going in circles on this. I know what they did to you from your initial post; i.e., raised you interest rate.

My question to you was "what authority are they pointing to" IN YOUR CONTRACT to allow them to raise your interest rate ? This is a question you need to ask them.

So far, from what you've said, it would appear that 10% interest is for the "life" of the loan.

So, get back to me with some answers from them. That means you have to contact them, get some answers, and then get back to me with their EXACT response and reasons. I'm going to try to help you, but remember, unless you want to write out your ENTIRE "note", verbatim, I don't have it in front of me for review. Therefore, I'm somewhat in the dark.

So, get some answers - - FAST !

IAAL
 

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