Students obtain loans for their studies from several sources. Financial have regulation when issuing this kind of note. On the other hand, the loan is high risk but no significant collateral as a backup. That’s why only a few banks issue this loan and make student loan promissory note. Other sources of this note are a private company, friends, family, and colleagues.
Understanding student loan promissory note
You are a student and apply for a loan that means you become a borrower. Bank and others give you the loan will be a lender. Both agree on terms and conditions regarding loans such as interest, payment, collateral, and other things. To legitimate this agreement, lender issues promissory note specifically for a student loan.
In general, student loan promissory note is financial instruction stated that the borrower agrees to pay a lender amount of money based on what has been received as a loan following terms and conditions. As you can see, student loan promissory note has legal standing that binds both parties. The student still pays the loan according to what has been written and signed in that note. Even though the note is stated as promissory, all terms are an obligation. This note is created to avoid an unwanted situation such as borrower refuses to pay or cannot complete term at a specific time.
Types of student loan promissory note
This note has several types based on where it comes from. Keep in mind that student loan promissory notes may be an agreement between you and your friend. He or she gives you a loan for study. Next list shows more about this topic
1. Bank promissory note
Bank has a template for student-loan master promissory note. Outline and content are derived from official regulation. When your application is approved, you read all the terms comprehensively.
2. Promissory note from a private source
Some financial institutions offer student loans with a promissory note. They are alternative if the bank cannot afford your loan. You should look around and see what kind of source available in your area. They might be a company, personal loan, credit union, and others.As similar to a bank, they also have student loan promissory note sample for reference.
3. Friend and colleague
Student loan promissory notes mandatory when you get money from friends and colleagues, including family.The loan is different from just giving money for helping your study. Note keeps both parties in a professional term. You know our friend since childhood. He or she gives you a loan including a promissory note that you must sign. After a certain period, you pay back and complete a loan with or without interest. Some people just give your loan with no interest.
Templates for student loan promissory note
You know what this loan can do and why it is necessary. Bank and the rest of the financial institutions already have a formal template for this loan. On the contrary, a personal loan from a colleague and friend is in a different situation. You require preparing some samples regarding student loan promissory note. Templates ensure you have proper content and outline for this note. Moreover, files are free that you can have without a fee. Files use platforms such as Word, Excel, PDF, and Google Docs.