A Virginia secured promissory note formalizes a financial transaction between borrowing and lending parties and provides an added safeguard in the form of collateral. This contractual agreement facilitates a personal loan, setting forth the terms for interest accrual, repayment, and collateral as a security measure.
Such arrangements are common among acquaintances, providing a structured method for the lender to ensure accountability and secure a return on their loaned forms. If the borrower doesn’t make their agreed-upon payments, the agreement grants the lender the right to claim the designated collateral to recover the outstanding loan amount.
