A promissory note is a "title or document by which a natural or legal person undertakes to make the payment of a specific amount at a future date" , defines the Bank of Spain, which recalls that, "when it is a commercial operation , the character of this document is similar to that of a bill of exchange". Thus, it is a document that reflects the commitment of one party (the issuer or signatory) to pay a sum of money in a specific period of time to another party (beneficiary). In addition, it must contain a series of minimum elements , such as the term 'promissory note', the promise to pay a certain amount, the name or company name of the beneficiary, the signature of the person issuing it, the date and place of issue and the expiration indication. How to endorse a promissory note To endorse a promissory note, the holder (beneficiary) must write his or her name on the back of the document and give it to another person so that he or she can claim payment. In this case, the person to whom the note is given becomes the new holder and can endorse it again if he or she wishes.
Advantages of the promissory note The advantages of using a promissory note as a means of payment are that it is a document that is easy to issue and endorse , it is a way to obtain short-term financing, and it offers security to the beneficiary, since it has the ability to demand compliance with the payment according to the agreed terms. Disadvantages The disadvantages Norway WhatsApp number are that non-payment can generate return and protest costs, and that the signatory can appear in non-payment records and lose their credit reputation. Additionally, if the note is unsecured, it may be difficult to collect in the event of default. The promissory note is classified as a credit instrument , since the creditor has the ability to demand compliance with the payment according to the agreed terms. But can you not pay a promissory note? What happens in case of non-payment? What happens if a promissory note is not paid? As mentioned, the promissory note reflects the.
Commitment to pay an amount of money by the person who signs it, who may be personally liable (acting on his or her own behalf) or with power of representation (on behalf of another or a company). If he does not pay the promissory note, the beneficiary who owns it (the holder) can demand the money from him and even resort to legal means and initiate a civil lawsuit . Specifically, the holder, if he does not collect a promissory note delivered in a timely manner, "may file a return action against the endorsers" as long as said non-payment is proven "through a notarial protest or equivalent declaration, except for promissory notes without expenses," they report. from Fideco Inversiones , a promissory note discount company . In addition, you can claim the amount from any of the parties obliged to the promissory note (signatory, endorsers, guarantors...), the interest contained (if an interest clause appears) and the return and protest costs, complemented by DGF , a Spanish company that advisor on financial services.