One of my close friends is asking for monetary help which is a big amount. I trust him but also want to document it to make my money safe. He will give me an undated cheque for the same amount. All money dealt in is white money, i ll make online transfers. 1. What is the best ever agreement/document for me to secure my money most - is it a LOAN Agreement, an Agreement to Sell or a Promissory note or something else and WHY? 2. If I make a loan agreement then what clause should I include in it that will give me the best chance to fight for my case in case he defaults and keep me secure- I mean something that acts as a "powerful weapon" in case of default.
Loan agreement is not necessary
2) your friend can request you for loan by email
3) you can in reply agree to grant a loan provided he repays loan within days period of one year and gives post dated cheque for principal amount
4) there can be provision for payment of interest on loan
You can execute a loan agreement or promissory note for the said amount. If you take undated cheque you can put amount and deposit the same in bank and if bounced can file proceedings against him
1. You can make an agreement notarized stating the friendly loan and along a promissory note.
Alternatively in case friend is having a property of equal value or more for same agreement to sale can be also made and amount can be shown as advance towards same.
In case he returns amount the agreement can be mutually.cancelled.
2. See cheque is most essential here as only with agreement you will have to go to civil court which take time when there is cheque and it is returned back then along agreement and cheque you can file a NIA act complaint.
A promissory note should be made and a blank cheque should be taken, undated of course. A timeline should be set and adhered to.
Don't take any chances.
By blank cheque you can go for NI act case.
Dear Sir
You should have an agreement on stamp paper of any amount as well as signed promissory note.
Agreement should be well drafted.
Also take multiple cheques and also if possible give a written communication to the bank of your freind about the cheques handed over to you for extra precaution.
Hi
Take the cheque he is giving you and get the agreement registered in the authorities.
I mean to say.
Make a registered agreement mentioning the cheque no. And all..
Thanks
1. You can lend the money on the basis of a loan agreement or promissory note and can also advance the amount by obtaining an equitable mortgage.
In an equitable mortgage, the owner has to transfer his title deed to the lender, thereby creating a charge on the property. The owner also orally confirms the intent of creating a charge on the property. An equitable mortgage is also known as an implied or constructive mortgage.
2. Loan agreements are binding contracts between two or more parties to formalize a loan process. ... Loan agreements typically include covenants, value of collateral involved, guarantees, interest rate terms and the duration over which it must be repaid.
Loan agreements typically include covenants, value of collateral involved, guarantees, interest rate terms and the duration over which it must be repaid. Default terms should be clearly detailed to avoid confusion or potential legal court action. In case of default, terms of collection of the outstanding debt should clearly specify the costs involved in collecting the debt. This also applies to parties using promissory notes as well.
Hello Mr. Kalaiselvan, can an layman/individual without money lending license enter into an equitable mortage deed and register it in court? Also, you mentioned the term "guarantee" in a Loan Agreement, in what ways can the borrower make a guarantee in this case?
You need a money lender if you are carrying on business of money lending
occasional transactions are not covered under money lending act
equitable mortgage by deposit of title deeds can be registered
You are going into more technical and practical details for which you may have to the assistance of an advocate in the local because whatever said here will create more and more doubts in your mind.
A loan guarantee, in finance, is a promise by one party (the guarantor) to assume the debt obligation of a borrower if that borrower defaults. A guarantee can be limited or unlimited, making the guarantor liable for only a portion or all of the debt.
A guarantee can be an individual or the lender can obtain a collateral security from the borrower
In the event that your guarantor is able to technically pay, but decides not to when they have been called upon to do so, then they are breaking the contract that they signed to with the lender and borrower. ... If no payment is made, the lender has the legal right to start a court order in order to retrieve the debt.
As the name suggest, equitable mortgage is created by the borrower in favour of the lender by deposit of title deed of immovable property as security to a lender until the loan is fully repaid. This creates a charge on the property, though no legal procedure is involved.
In my opinion, the best document is an agreement mentioning that I have given x amount to A as friendly loan vide cheque/DD/RTGS credited in account number xxx of A for a period of six month latest by 31.08.2020. A has given a postdated cheque for Rs.xxx dated 31.08.2020 for Rs.xxxx towards the liability against B. B can present the said cheque immediately on 31.08.2020 or within the validity of the cheque.
I think this is the best document.
I am at location A and my friend, the borrower in another city B. I want all trials to be held at location A in case he defaults. 1. Do I have the option to file suit in city A or do we have to mutually agree and mention in our Agreement/Promissory note about the trial venue? 2. In case of Agreement to sell, is the venue automatically decided by the location of the property or I can file for suits in my city A? 3. Is there anything else I should know about location of trials?
in agreement there should be clause that in event of any disputes it would be subject to jurisdiction of courts at A only
2) suit in case of agreement to sell should be filed where property is situated
1. Equitable mortgage can be created and same can be registered with the sub-registrar office.
1. See in case of cheque bounce if security cheques are there jurisdiction shall be as per the act also for suit in agreement you can mutually agree.
2. For property it is location of the property.
There is no need for promissory note or agreement to sell . loan agreement is sufficient. The cheque bounce case jurisdiction is where the cheque is presented. If the cheque is presented in a bank which is located in South west, jurisdiction is Dwarka court.
My friend has given me an undated cheque for a big amount of loan I have given him. 1. Will this be considered a "security cheque" and not be covered under under NI act till the time of agreed date of repayment of loan (which is two years? 2. If I show this cheque details in our loan agreement then will it have any negative impact on my case in case he defaults and subsequently cheque is dishonoured? 3. What's the best manner I should use this cheque in the court if he defaults?
1. You can make a clause about the dispute jurisdiction in the loan agreement which will help you to initiate legal process in the jurisdiction mentioned in the document.
2. The suit for specific performance of contract can be fiddled in the jurisdiction where the property situate.
3. Well the above two are answers for now.
Even in case of dishonour of security cheque complaint under section 138 NI is maintainable
2) it would not have negative impact if cheque details are mentioned in loan agreement
3) in case of dishonour of cheque file summary suit under order XXXVII of code of civil procedure to recover your money with interest
1. It will be considered under NI you can present cheque for repayment , you don't have to mention security cheque over the cheque or in agreement .
2. Do not show cheque details or describe cheque in the agreement.
3. Cheque for repayment.
1. Generally the venue is place where the agreement is executed or you need to select a place with mutual consent in the same
2. Yes mostly location or a specific place fixed by consent in agreement
3. No
1.some security cheques are also covered in 138 NI Act depending on the facts proved in trial.
2. No as such but actual non payment will result in the same
3. You can execute an agreement and contest the same in court if he defaults
1. You can take promissory note from your friend apart from post dated cheque.
2. You can make a loan agreement with friend in which you can mention post dated cheques and promissory note that he have taken the loan and gave these documents for purpose of recovering the loan.
