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Form Of Note For Construction Loan P&i Only

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Exhibit 10.3(a)
PROMISSORY NOTE


Loan No.: _______________________ __________________, 19______
Redwood City, California


FOR VALUABLE CONSIDERATION, ___________________________________________________ (herein "Maker"), hereby promises to pay to ______________________________________________________, or order (herein "Payee"), at the address set forth below, or at such other address as the holder hereof may, from time to time designate, the sum of ___________________________ ____________________________ ($_______________) with interest on the unpaid balance of the principal sum disbursed by Lender to or for the account of Borrower at the interest rate specified below.


1. Interest


Maker agrees that interest earned by and payable to Payee hereunder (Interest) shall be a fixed rate per annum equal to ______________ percent (___%). Interest shall be calculated for actual days elapsed on the basis of a 360-day year, which results in higher interest payments than if a 365-day were used.


Interest shall be payable monthly on the first day of each consecutive month beginning on the first such date after the first advance under this Note and continuing through ________________ ("Maturity Date"), on which date the entire balance of the unpaid principal sum then disbursed and all interest accrued and unpaid shall be due and payable.


2. Prepayment


The right is reserved by Maker to prepay the outstanding principal amount in whole or in part together with accrued interest thereon. All prepayments shall be applied to the most remote principal installments then unpaid under this Note.


3. Late Charge


If Payee fails to receive any payments of interest or principal within ten (10) days after the date the same is due and payable, a late charge to compensate Payee for damages Payee will suffer as a result shall be immediately due and payable. Maker recognizes that a default by Maker in making the payments agreed to be paid when due will result in Payee's incurring additional expenses in servicing the loan, including, but not limited to sending out notices of delinquency, computing interest, and segregating the delinquent sums from not delinquent sums on all accounting, loan and data processing records, in loss to Payee of the use of the money due, and in frustration to Payee in meeting its other financial commitments. Maker agrees that if for any reason Maker fails to pay any amounts due under this Note so that Payee fails to receive such payments within ten (10) days after the same are due and payable, Payee shall be entitled to damages for the detriment caused thereby, but that it is extremely difficult and impractical to ascertain the extent of such damages. Maker therefore agrees that a sum equal to $.06 for each $1.00 of each payment that becomes delinquent ten (10) days after its due date, is a reasonable estimate of the fair average compensation for the loss and damages Payee will suffer, that such amount shall be presumed to be the amount of damages sustained by Payee in such case, and that Maker agrees to pay Payee this sum on demand.


4. Default


If there exists any Event of Default, as defined below, under the terms of this Note or under the terms of the Construction Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing ("Deed of Trust"), Holdback Agreement, or any other document executed in connection with this Note (herein called "Loan Documents"), Payee or the holder hereof is expressly authorized without notice or demand of any kind to make all sums of interest and principal and any other sums owing under this Note immediately due and payable and to apply all payments made on this Note or any of the Loan Documents to the payment of any such part of any Event of Default as it may elect.


An Event of Default shall be either (1) a default in the payment of the whole or in any part of the several installments of this Note when due and such default continues for five (5) days following written notice from Payee, or (2) any of the Events of Default contained in any of the Loan Documents. At any time after an Event of Default, during the continuance of such Event of Default, the entire unpaid balance of principal, together with interest accrued thereon, shall, at the option of the legal holder hereof and without notice (except as specified in any Loan Documents) and without demand or presentment, become due and payable at the place of payment. Anything contained herein or in any of the Loan Documents to the contrary notwithstanding, the principal balance together with accrued interest thereon so accelerated and declared due as aforesaid shall continue to bear interest and shall include compensation for late payments on any and all overdue installments as described above.


If a default has occurred, the failure of Payee or the holder hereof to promptly exercise its rights to declare the indebtedness remaining unpaid hereunder to be immedia
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