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What is a promissory note?

A written agreement to rent a property

A written promise to pay a specified amount of money

A promissory note is fundamentally a written promise to pay a specified amount of money. This instrument is crucial in financial transactions, especially in loans and mortgages, as it outlines the borrower's commitment to repay the loan under agreed terms, including the amount, interest rate, and payment schedule. The note serves as evidence of the debt and includes the borrower's signature, giving it enforceable legal standing in the event of a default.

In the context of mortgage law, the promissory note typically accompanies a mortgage agreement, but it specifically focuses on the borrower's obligation to repay the lender, rather than the ownership of the property or the rental terms. This distinguishes it from other documents like leases or property transfer deeds, which serve different purposes in property management and ownership.

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A legal document to transfer property ownership

A summary of mortgage terms

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