When working for a client you need to have the assurance that you will get paid for your hard work. There are different ways that this can be done. If you do not have this proof you may end up not getting paid for your work and no way to demand anything for it. A promissory note can be used here.
What is a work completion promissory note?
A work completion promissory note is the financial instrument that has a written promise by the issuer that they will pay the other party a certain amount of cash when they have completed the required work. A promissory note often has all the terms concerned with the indebtedness, like the principal amount, date and place of issuance, issuer’s signature, etc.
Importance of a work completion promissory note:
A work completion promissory note allows people or companies to get financing from some other source rather than a bank. The source may be some individual or company that has given the note. The note allows the recipient to be satisfied that they will be paid for their work. All details concerned with this payment will be stated so that no one gets confused later on. The terms and conditions will not allow one to claim something else at a later time.
Tips to create a work completion promissory note:
From the above, you can tell that a work completion promissory note is indeed an important and professional document. It should therefore be made in this way. The following tips can be kept in mind here:
Application: Because the document is a professional one you need to type it in a good application. You can consider Microsoft Word here. It is possible to choose from many fonts and the note can be easily typed here.
Heading: The note needs to have a heading that will allow the reader to know what it is concerned with. The heading for this one will be “Work Completion Promissory Note”. The heading should be present at the top of the note. It can have a bigger size font than the rest of the document so that it is prominent.
Amount: The total amount that the note is concerned with should be stated in full. Add the words “Amount” before doing this.
Date: The date is important, and an area has to be present for it. If the note needs to be consulted, later, the date helps tell when it was given.
Place: An area for “place” can be present helping know where the note was given or where the cash was received.
Details of payment: You will state the complete name of the person who has committed to pay. This can be done in paragraph form with “I” and then the name of the person. State how much money needs to be paid. You will give details on how payment will occur. It may be in some equal payments and at a certain interest rate. The date that the payment will occur should be given from when payment will start. You need to state that you promise to pay the amount. You can state when this promise has been made and proof that you will pay.
Signatures: Without any signatures, any document loses its authenticity. A document like this needs signatures to make it valid and official. The signature of the sender will be present. If they have claimed to pay under a certain seal, the notary public seal should be present.
Name and address: The name and address of the party concerned will be stated. You can add a space for when the commission will expire.
Final Words:
A work completion promissory note is a very important and formal document. It should therefore be made in this way. Know what points to include so that nothing important will be left out. The receiver must see it as a valid document so that they can be satisfied that you will pay them for their hard work. Therefore the note should not have any errors. It must be typed carefully and precisely. Only include those details that are needed.
Sample Promissory Note Template
TO WHOM IT MAY CONCERN
I, Andrew Johnson, hereby make a commitment to pay a total sum of 5000US$ to Stars construction company at its head office which is located at [address], or at another address as specified by the company hereof. This principal amount is to be paid without any interest.
The principal amount will be paid to the company in parts i.e., before, during, and after completion of the work. Beginning on 1st August 20XX, the amount must be paid not later than January 31, 20XX.
I shall be liable to pay all expenditures and costs incurred in the completion of work, without limitations. In addition, the amount incurred in the enforcement of this note will also be added to the principal amount, which is payable.
If any part of this note is declared as void by the competent authority, parties will decide to reduce it to the extent of enforceable. However, the remaining conditions will not be affected at all.
This note must be construed as per existing laws of the state.
This note must be secured and recorded in all applicable governmental offices.
If any portion or due payment in full is past due by 15 days, a 10% surcharge will be applicable. Such a late surcharge will be payable without the company’s demand.
The principal amount, late surcharge, or any part of the payment will be payable to the holder of this document.
As a witness, I am signing this document hereunder and acknowledge receipt of this document.
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Signature of borrower Signature of company representative
File: Word (.docx) 2007+ and iPad
Size 21 Kb
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