Legal Question in Civil Litigation in Utah

Promissory Note

I have lent a large amount of money to a friend over the past 8 years. I want to be sure that I will be about to get the money back if the friendship ends. They have agreed to sign a promissory installment note for the total amount. If they do not pay back the money, what information needs to be in a promissory note (other than borrower, lender, principal amount, payment and interest information) if it becomes necessary to take the person to court to collect the money? Can there be something put in the note that says it can not be cleared by a bankruptcy? Is only the borrowers signiture required or is a witness needed?


Asked on 12/25/03, 1:17 am

1 Answer from Attorneys
Alvin Lundgren Alvin R. Lundgren, L.C.

Re: Promissory Note

You will also need dates of performance and information on your rights in the event that he defaults (late fees, attorney fees and court costs). It would be pre-eminently wise to obtain some collateral for the loan, such as a mortgage (even a second or third) on real estate, or against a vehicle or other items of value. Clauses which prohibit bankruptcy are worthless. If he declares bankruptcy you are entitled only to the equity in the collateral. No collateral, you could lose everything. You do not need a witness, except if you take collateral, in which case it depends on the type of collateral.

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Answered on 12/25/03, 9:23 am


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