Document background
A Family Promissory Note is essential when documenting financial loans between family members in New Zealand. This document is particularly useful when family members wish to formalize lending arrangements while maintaining compliance with New Zealand law, including the Property Law Act 2007 and Contract and Commercial Law Act 2017. It's commonly used for various purposes such as helping family members purchase property, fund education, or start businesses. The document includes crucial details such as the loan amount, repayment schedule, interest rates (if any), and default provisions. While maintaining legal enforceability, it's designed to be more straightforward than commercial loan agreements, acknowledging the unique nature of family financial relationships. The document should be drafted with consideration of potential future events such as relationship property disputes or estate planning implications.
