There will come a time when a current tenant may fall seriously behind or owe you for something due under the lease, such as an accumulated water bill, a bounced security deposit check or some damages they did to the premises. A promissory note is simply an agreement when one party agrees to pay another party a particular past due sum or currently due sum on a particular date or dates.
Some recommend that a promissory note should be used only with a past or departing tenant owes you money and desires to pay you on a certain date or dates according to the payment arrangement spelled out on the promissory note. These people also recommend never using such an arrangement with a current tenant. The tenant may vacate owing you past due rent, late charges, unpaid utility bills or anything owed under the terms of the lease This Note will memorialize the debt in writing and can be used later if the past tenant defaults, and you wish to pursue the debt.
These same people recommend that a promissory note should not be used with a current tenant who owes you money. They point out that unless the promissory note clearly states that the amount is rent due under the terms of the lease, the landlord may have unwittingly converted past due rent into simply a monetary obligation for which he will not be able to evict the tenant using a Statutory Notice Period. Also suppose the tenant fails to make a payment, what is owed: the full balance all at once; or only that missed payment? This matter may be clarified by an acceleration clause in both the lease and the Note.
A California Promissory Note for Past Due Rent is a legally binding document that outlines the terms and conditions under which a tenant agrees to repay the landlord for rent that is past due. This type of promissory note is specifically designed for tenants in California who have fallen behind on their rental payments and need to establish a formal repayment agreement. The California Promissory Note for Past Due Rent can be classified into three main types: 1. Standard California Promissory Note for Past Due Rent: This is a general promissory note that is used when a tenant is unable to pay their rent on time and wants to establish a repayment plan with their landlord. It outlines the amount of the past due rent, the interest rate (if applicable), the repayment schedule, and any late fees or penalties. 2. California Promissory Note with Interest: This type of promissory note includes an additional interest rate that the tenant agrees to pay on the past due rent. The interest rate is typically specified as a percentage and is added to the total amount owed by the tenant. Including interest helps to compensate the landlord for the delayed payment. 3. Conditional California Promissory Note for Past Due Rent: A conditional promissory note is used when the tenant is unable to make the full payment in one lump sum and needs to negotiate specific conditions for repayment. This could include a reduced payment plan, extended due dates, or other arrangements that suit both parties involved. When drafting a California Promissory Note for Past Due Rent, it is crucial to include specific details such as the names and contact information of both the tenant and the landlord, the exact amount of past due rent, the agreed-upon repayment schedule, and any additional terms or conditions. The document should be signed and dated by both parties to ensure its validity. By using the relevant keywords such as "California Promissory Note," "Past Due Rent," and "Repayment Agreement," landlords and tenants can easily find the necessary resources and templates to create a comprehensive and legally binding document that protects the rights and responsibilities of both parties involved in the repayment process.
