In the world of lending and borrowing, promises and IOUs aren’t enough. When money changes hands, it’s essential to have a clear, legally sound agreement outlining the terms of repayment. That’s where a promissory note comes in – a written promise to repay a debt.
But what if you want to add an extra layer of security and legal enforceability to that promise? You might have heard about something called a notarized promissory note. But what does that really mean, and what is the benefit of a promissory note with notary services?
This article will explore what happens when a promissory note includes the extra assurance that a notary public can provide!
Promissory note with a notary: what it means and why it matters
At its core, a promissory note with a notary is simply a standard promissory note document that has undergone the process of notarization by a licensed notary public. But don’t let the simplicity fool you – that act of notarization can make a significant difference.
So, let’s break down just what a notary does in this situation. Their key functions can be broken down into these following points:
- Verifying the identity of the borrower;
- Ensuring the borrower is willingly signing this document;
- Personally witnessing the borrower signing the document;
- If applicable, administering an oath or affirmation;
- Completing a notarial certificate on the promissory note;
- Finally, affixes their official notary seal and signature to the notarial certificate.
With these aspects down, we can understand the core of notarial procedures – it provides something more than the mere action of signing a paper. In this case, the actions provided by a notary public add:
- Independent verification of identity: the notary helps protect all parties involved by verifying everyone’s identity;
- Deterrence to fraud & forgery: with a witness to your signing, both parties get an additional step to prevent others from doing wrong;
- Increases legal weight in the courts: having a notary on your promissory note greatly helps in court and provides legal support for the action;
- Creating an official record of signing: for all the times you’re not sure if a transaction took place, having documentation from a licensed notary public will add significant validity to all sides involved.
As we can see, what distinguishes the process of a promissory note with a notary greatly helps to ease the mind while providing value for all parties involved!
Benefits of notarizing a promissory note
So, why should you even bother getting a promissory note notarized? Is it really worth the extra time and effort? While notarization isn’t required for a promissory note to be legally valid in all cases, there are tangible advantages that make it a very smart decision:
One of the biggest benefits is enhanced enforceability. Should a borrower default on the loan and a legal dispute arise, having a notarized promissory note can significantly strengthen your case in court.
It makes it far easier to prove that the borrower actually did sign the note and agreed to its terms, reducing the potential for them to later claim the signature was forged or that they didn’t understand what they were signing.
Notarization can also increase borrower accountability. The formality of signing a document in front of an impartial official, taking an oath (if a jurat is used instead of a simple acknowledgement), can impress upon the borrower the seriousness and legal nature of the agreement.
It might deter them from casually disregarding their repayment obligations. Also, the advantages for having the help of a trained professional are unmatched by any other thing.
For lenders, a promissory note with a notary simply provides greater peace of mind, which is something to consider. It reduces the risk of disputes over signatures and offers a stronger legal position should they need to take action to recover the funds.
Also, this will increase their confidence in the loan agreement and their return with other lenders as well.
How to notarize a promissory note: here’s what to do
If you’ve decided that the benefits of a promissory note with a notary are worth it, here’s a barebones guide on how to get it done:
- Prepare the promissory note: the promissory note must be fully completed and agreed upon by both parties before it can be notarized. Leave no blanks!
- Do NOT sign in advance: the borrower (and the lender, if they are also signing) must not sign the promissory note before going to the notary. The entire act of signing must take place in the notary’s presence;
- Appear before a notary public: the borrower (and sometimes the lender) needs to physically appear before a commissioned notary public. If finding a suitable time for all parties involved is tough, you might benefit from mobile notarization services;
- Provide valid identification: all signers must present a current, government-issued photo ID to the notary public for identity verification. Expired or invalid IDs will not be accepted. You can learn more on valid forms of identification in our other article;
- Sign the promissory note: now, in the presence of the notary, the borrower signs the promissory note. The notary will watch as the signature is applied to the document;
- Notary completes notarial certificate: finally, the notary public will complete the appropriate notarial certificate, add their seal and signature to the document, and make a record of the notarization in their notary journal. This creates an official record of the event.
Common questions about promissory notes and notarization
You might still have some questions running through your mind, so let’s see if we can cover them:
- Is notarization required for a promissory note to be legally valid? No, notarization is not strictly required for a promissory note to be legally valid – a signed written agreement is generally sufficient. However, as discussed, notarization greatly enhances its enforceability and reduces the risk of disputes.
- What type of notarial certificate is best for a promissory note? An acknowledgment is a common and generally sufficient choice. However, if you want to add extra formality and have the signer swear or affirm the truthfulness of the document’s contents under oath, you can use a jurat. The choice depends on the level of formality desired and any specific legal requirements in your jurisdiction.
- Can a lender notarize their own promissory note? Absolutely not! A notary public must be an impartial third party. The lender cannot notarize a promissory note where they are a party to the agreement. This would create a conflict of interest and invalidate the notarization.
- Does notarization guarantee repayment of the loan? Not at all. Notarization only confirms the signature’s authenticity and the identity of the signer. It does not guarantee the borrower’s financial capacity or willingness to repay the loan. It simply makes it more likely that the promissory note will be enforceable in court if repayment issues arise.
- Can mobile notarization be used for promissory notes? Yes! Mobile notarization is a perfectly acceptable and often very convenient way to get a promissory note notarized. A mobile notary will travel to your location, saving you time and effort.
Closing thoughts…
In conclusion, a promissory note with a notary can take it a step further, solidifying its legal integrity and providing neat benefits for both the borrower and the lender. Though not a strict legal necessity, adding notarization provides the best chances of success while being affordable.
If you’re looking to strengthen your promissory note and gain peace of mind, consider contacting Mobile Notary Orlando for professional and reliable mobile notary services. We service all of Osceola, Brevard, Seminole, and Orange counties and are here to help you with many other documentation requests!
