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What Forms Do I Need to File A Security Interest in a Promissory Note?

What Forms Do I Need to File A Security Interest in a Promissory Note?

Q: Do you have to pay taxes on a loan from family?

Generally, loans from family members are not considered taxable income, so you do not have to pay taxes on the amount received. However, if the loan is forgiven, it may be treated as a gift, which could have tax implications. It's advisable to document the loan properly to avoid any misunderstandings with the IRS.

Full question:

My wife and I borrowed $60,000 as a personal loan from my mother toward a down payment on our new home a year ago. The loan document gives her the right to secure the principal by lien against our residence. She has asked us to handle the lien process for her, but I'm unable to locate proper forms for filing a consensual lien. Appreciate guidance and/or link to the proper forms.

Category: Real Property
Subcategory: Liens
Date: 04/07/2025
State: California

Answer:

We are unsure whether you are asking about recording the lien that's in the loan note or whether she seeks to foreclose the lien of the property due to default on the loan. If you merely wish to record the lien that is described in the loan, most county recorders office will accept such documents for filing. You may contact the county recorder's office where the property is located to inquire about applicable filing fees.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

How do you prove money is a loan and not a gift?

To prove that money is a loan and not a gift, you should have a written loan agreement that outlines the terms, including the amount, interest rate, repayment schedule, and any collateral. Documentation such as bank statements showing the transfer of funds and any communication regarding repayment can also support your claim. If the loan was made to a family member, it's helpful to keep records of conversations or agreements to clarify the intent.

Can you take out a personal loan to make a down payment?

Yes, you can take out a personal loan to make a down payment on a home. However, lenders may have specific requirements regarding the source of your down payment. They may want to see that the loan is documented and that you can afford to repay both the mortgage and the personal loan. Always consult with your mortgage lender to understand their policies.

How do you prove a loan is not a gift?

To prove a loan is not a gift, maintain a written agreement that specifies the loan amount, repayment terms, and any interest. Documentation such as bank transfers, promissory notes, and records of payments can help establish that the funds were intended as a loan. Clear communication with the lender about repayment expectations is also important.

How do you prove someone borrowed money?

To prove that someone borrowed money, you should have a written loan agreement that details the amount borrowed, repayment terms, and any interest. Additional evidence includes bank statements showing the transfer of funds and records of any payments made. Witnesses to the agreement or communication regarding the loan can also support your claim.

Do you have to pay taxes on a loan from family?

Can someone put a lien on my house without me knowing?

In most cases, a lien cannot be placed on your house without your knowledge. A lien typically requires a legal process, which includes notifying you. However, if you default on a loan or fail to pay certain debts, creditors may file a lien against your property. It's important to stay informed about any debts and legal actions related to your property.