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.
Title: Exploring North Dakota Promissory Note for Past Due Rent: Types and Detailed Description Introduction: A North Dakota Promissory Note for Past Due Rent serves as a legally binding agreement between a landlord and a tenant who has fallen behind on their rental payments. This document outlines the terms and conditions under which the tenant agrees to repay the outstanding rent amount in a structured manner. Understanding the different types of promissory notes available in North Dakota is essential for both landlords and tenants dealing with past due rent situations. 1. North Dakota Promissory Note for Past Due Rent — Type 1: This type of promissory note outlines the basic terms and conditions for repayment of past due rent. It includes crucial details such as the tenant's name, landlord's name, property address, the total amount of past due rent, repayment schedule, and any additional applicable charges or interest rates. 2. North Dakota Promissory Note for Past Due Rent — Type 2: In some cases, landlords may offer a more flexible repayment plan to tenant facing financial difficulties. This type of promissory note may include provisions such as reduced monthly payments, extended repayment periods, or partial forgiveness of overdue rent. It is crucial for both parties to clearly outline the agreed-upon terms to avoid any confusion or disputes. 3. North Dakota Promissory Note for Past Due Rent — Type 3: Specific situations may call for a more customized approach to the promissory note. For example, if the tenant expects to receive a significant sum of money at a specific date in the future, both parties can agree to delay the repayment until then. It is important for this type of promissory note to specify the exact date and amount to be paid and any other relevant terms and conditions relating to the delay. Features of a North Dakota Promissory Note for Past Due Rent: a. Payment Schedule: The promissory note must clearly outline the repayment plan, including the amount to be paid, due dates, and frequency of payments (weekly, bi-weekly, monthly, etc.). b. Interest or Additional Charges: If applicable, the note should state the interest rate or any additional charges imposed on the overdue rent, in accordance with North Dakota law. c. Legal Compliance: The promissory note must adhere to the applicable state laws and regulations to ensure its enforceability in case of a dispute. d. Signatures: Both parties, the landlord and the tenant, must sign and date the promissory note to indicate their understanding and agreement to its terms. Conclusion: A North Dakota Promissory Note for Past Due Rent is a crucial legal document that provides structure and clarity in resolving rent payment arrears. By understanding the various types of promissory notes available and their specific features, landlords and tenants can effectively address overdue rent situations while ensuring a fair agreement for all parties involved.
