Posted on: 29th Aug, 2010 01:33 pm
I am holder of balloon Note due January 2011. By what date or month should I notify the payee to remind him of the upcoming all due date ? Also is it customary to offer an extension or modification of terms if he is not able to pay on due date? If so what would be a correct interest rate increase? Interest rate is now at 5%
Hi Linda,
As you're the holder of the note, it is completely your discretion as to when you would give the borrower a notice about the balloon note. If the borrower requests you for a modification or extension of time period to pay off the loan, then it's your discretion whether or not you would consider this request. Market rates keep on changing. You can check out the rates when you offer an extension of the loan and then charge the interest rate accordingly.
Thanks
As you're the holder of the note, it is completely your discretion as to when you would give the borrower a notice about the balloon note. If the borrower requests you for a modification or extension of time period to pay off the loan, then it's your discretion whether or not you would consider this request. Market rates keep on changing. You can check out the rates when you offer an extension of the loan and then charge the interest rate accordingly.
Thanks