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Definition of promissory note loans
The promissory note loan is long-term, bond-like borrowed capital of a larger size, which is provided by capital collection agencies under certain conditions. Capital collection centers are companies in which large sums of capital accumulate through voluntary or compulsory savings, e.g. B. with insurance companies, savings banks, building societies, social security agencies.
Basis of the borrower's note loan
The borrower's note loan can be based on a borrower's note. It does not certify any rights, but only has a function of evidence. When it is handed over, there is no transfer of claims. This can only be done by assigning a claim. Accordingly, the loss of the promissory note does not lead to the loss of the receivables. Today the promissory note loan is often agreed without a promissory note. Instead, a loan agreement is concluded.
Types of borrower's note loan
Promissory note loans with matching maturities
The borrower's note loan with matching maturities, in which the duration of the capital provision corresponds to the duration of the capital utilization. The investor takes a deadline risk. The interest rate risk can lie with the investor if z. B. the interest is agreed at a fixed rate over the term.
revolving promissory note loans
The revolving borrower's note loan, in which the deadlines for providing capital are shorter than the deadlines for capital utilization. Practically, therefore, you need several shorter-term loans for a long-term one financing are directly strung together.
the Cost of capital may include interest, trustee, notarization, registration, cancellation fees and agency fees.