Does a promissory note need to be? Does the lender have to sign a promissory note? What is the difference between a promissory note and a loan agreement? Who must sign a promissory note?
When all of these conditions are addressed in the promissory note details and it is signed by both parties, the promissory note meets all the elements of a legally binding contract. From your facts it appears you are the borrower and your mom, the lender.
To be enforceable, the note has to be signed by you. In general, at least the borrower should sign the promissory note. Depending how much the parties trust each other, you may also wish to have the lender sign as well AND get the signatures notarized. A valid promissory note only needs the signatures of the participating parties involved in the agreement, not necessitating acknowledgment or being witnessed by a notary public to be legitimate. I agree with your mother-in-law.
When the agreement is formalized in writing, there is less chance of disagreement later. I have been told that loans between family members are more often left unpaid than loans between friends, and I can. The lender need not sign because it will be the lender filing the suit to enforce the promise of the borrower. (more…)