Question by  worker5928 (8)

How is a lien used to secure a promissory note?

I do not understand the use of a lien in securing a promissory note.


Answer by  tamarawilhite (17883)

If you do not pay the promissory note, the lien can be used to collect upon sale of the property, such as car or house.


Answer by  MikeG (1650)

A "Lien" can be used as collateral in the event that you were in default of the parameters set forth by the promissory note. That way the lien can be used to take possession of said object.


Answer by  SubhashChander (1773)

A promissory note is a type of guarantee which your banker agrees to honor in case of any default and so the lien is necessary for the banker's purposes.


Answer by  flamiss22 (5081)

It states you agree to put the person giving you the loan on the note. So if at anytime you default on the payments the person can get your property.

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