Promissory Note question...

[justin22g]

I have finally graduated from Auburn and heading to law school in the spring.

My parents and I bought a mobile home my freshman year and we saved a ton of money, but we were having problems selling it.

Finally, one of my friends said he could put $1,500 down and finance the rest through me. This is the last thing I wanted to do, but I agreed since I don't want to be stuck with lot rent.

I intern at a law firm and pulled a promissory note and security agreement from their files. One of the lawyers was gracious enough to help me, but he has been super busy and I feel I have been getting on his nerves by asking so many questions.

We will be signing these documents on monday, so I am just making sure everything is OK.

Heres the documents I am having him sign:

1) promissory note (+ a co-signer, his boss)

2) security agreement (so I can repossess if he defaults)

3) Bill of sale

My mobile home is old, so therefore no title is needed. The attorney told me to get a UCC1 form and file it in probate. The UCC1 takes the place of title as far as making a public record of the fact that the buyer owes money on the Mobile Home.


After all this is said, He has already asked me if he can make extra payments each month, so I don't there will be a problem.

I'm just making sure this is all that is needed...

TIA!

- you can call me trailer trash if you help answer my question :toast:

 

[bjfinste]

You're going to a law school that starts in the spring?

 

[Ravenous]

Justin, it is probably fine, assuming the co-signer is credit-worthy. Does his boss have enough assets to pay you if he doesn't? Does his boss have enough control over him to take the money out of his paycheck and pay you directly if he doesn't pay? If the answer to either of those questions is no then don't do the deal, whether you have a valid security interest or not.

You probably are not going to want to repo the trailer if he defaults anyway, because you'll have to move it and all that stuff. Plus, if he isn't going to pay you he's probably not going to take care of the trailer either. You are much better off relying upon the guarantee of his boss than looking to the collateral for payment.

I'd still file the UCC-1, but if he defaults I want the money from the boss.

 

[justin22g]

You're going to a law school that starts in the spring?

yes, it's unaccredited and they accept incoming freshman in the spring.

Birmingham School of Law

the comparison of tuition costs compared to Alabama or Cumberland... well there is no comparison.

The classes are at night as well, so I will be able to work, meaning no student loans.

 

[bjfinste]

yes, it's unaccredited and they accept incoming freshman in the spring.

Birmingham School of Law

the comparison of tuition costs compared to Alabama or Cumberland... well there is no comparison.

The classes are at night as well, so I will be able to work, meaning no student loans.

Are you sure that is the route you want to take? What do you want to do after graduation?

 

[justin22g]

Justin, it is probably fine, assuming the co-signer is credit-worthy. Does his boss have enough assets to pay you if he doesn't? Does his boss have enough control over him to take the money out of his paycheck and pay you directly if he doesn't pay? If the answer to either of those questions is no then don't do the deal, whether you have a valid security interest or not.

You probably are not going to want to repo the trailer if he defaults anyway, because you'll have to move it and all that stuff. Plus, if he isn't going to pay you he's probably not going to take care of the trailer either. You are much better off relying upon the guarantee of his boss than looking to the collateral for payment.

I'd still file the UCC-1, but if he defaults I want the money from the boss.

Thanks Ravenous. He works at a place that does landscaping and golf course maintenance throughout Alabama. His boss is actually the owner of this company, and he already said he will foot the bill if something comes up.

I am pretty good friends with the guy buying it, and I gave him a deal on it. Also, my best friend lives right next door to the trailer that I am selling. If anything happens, I will be the first to know.

Also, his boss let him borrow $700 for the DP. I told him to ask if he could borrow the total amount, but he didn't want to seem greedy.

I would not have done this if his boss didn't co-sign.

I would have preferred to do a lease-agreement, but the park that I live only allows owners.

once again, Thanks Ravenous :toast:

 

[justin22g]

Are you sure that is the route you want to take? What do you want to do after graduation?

I know many lawyers around the area that have graduated from this school.

I plan on taking a clerk job while I'm going to school. I will sit for the bar and hopefully get a job with a firm in my hometown.

I would love to prosecute as well.

 

[bjfinste]

I would love to prosecute as well.

:nooo:



I hope it all works out for you (other than the prosecutor part... you go in thinking you're noble, and the next thing you know you're power-hungry piece of scum... don't do it).

 

[justin22g]

:nooo:



I hope it all works out for you (other than the prosecutor part... you go in thinking you're noble, and the next thing you know you're power-hungry piece of scum... don't do it).

I believe I would still enjoy it... maybe?

Hopefully things will all fall into place for me.