Promissory note loan – is it worth it?

Bills of Exchange – a desperate solution that doesn’t fit in any situation

money bills

People in desperate situations most often resort to a loan for a bill of exchange. Typically, these are over-indebted people, persons in distraint or insolvency, and all others who are no longer lent not only by the bank but also by a non-banking company. A private person who lends money to a bill of exchange usually does not look at such things. He doesn’t care if you’re under execution and you’re working black for a few scuffs, so there’s no demonstrable income.

The private owner will be happy to lend you a bill. All you need is your first and last name, as well as the address to which you stay most often. In addition, a few signatures that guarantee that he will receive his money, whether on a regular payment schedule or seizure of all your property. Similar private individuals do not bind the law and legislation and are not afraid to recover the loan by all available means.

What is an arbitration clause and an enforcement record?

If you are taking a loan for a promissory note, you must sign a few extra papers in addition to the promissory note. With your signatures, the lender for the bill of exchange will ensure that he will not have to go to court to recover money. In such a case, he would run into trouble himself, for usury, which these private individuals usually operate. The first paper that you will need to sign in addition to the bill is the so-called arbitration clause.

  • arbitration clause
    In that case, you confirm that you will not complain in court. If you have a problem with the lender, you will be judged by a financial arbiter whose judgment has legal force and cannot be appealed against. That doesn’t sound so bad yet. Worse, most private borrowers have their own Financial Arbiter, who decides on their behalf.
  • Execution notation
    This paper gives creditors the opportunity to confiscate all property, even in the case of a one-day delay in payment. This is exactly what you guarantee for the loan, even though the provider may claim that it is a loan without liability.

If you take a loan from a private pledge or surety, it means that during the repayment eventual pledge will call the lender just your lender. However, this will not prevent you from confiscating your other assets.

Another negative of a loan for a bill of exchange


You borrowed a bill from a friend, but after a few months, someone else knocks on the door with a bill. Not even an unusual situation. The private owner can simply sell your bill, your debt. Anyone. Then your recovery is up to the new lender, who can set his own rules. This is one of the reasons why a loan for a bill is dangerous and can ruin the rest of your life.

The interest of the loan on the bill of exchange is usually a liquidation. It is with bills of exchange that we can rightly speak of usury. Worse, if you are late, even by one day, the lender can raise your interest several times. However, given what you signed at the conclusion of the contract, you are not entitled to defense and you have no choice but to pay in return whatever the creditor can think of. Or end up without a roof over your head.

What can you expect from a loan for a bill of exchange?

  • Seizure of all property,
  • blackmailing you and your loved ones,
  • visiting the enforcer at different times of the day,
  • sale of a bill of exchange to enforcement agencies,
  • liquidation interest,
  • on a day of delay up to 100%, even higher, the increase in interest and aggressive enforcement,
  • loss of roof overhead and all property.

Speaking of the loss of all property, in this case, you might imagine a classic execution. However, the confiscation of assets in a promissory note loan is different. The bailiff restricts the law and can confiscate only some things. A private person who owes you a bill of exchange can get rid of your toothbrush.

Does the loan for bills of exchange have any positives at all?

It doesn’t. You can get a loan for a bill of exchange in virtually any life situation. You may have a distraint and debtor register itself negative record. You can work black and stay in a hostel with insolvency and a few hungry necks. The private owner is usually not interested in any of this and will lend you half a million if you prove at least the minimum ability to pay. And even this usually does not double-check carefully.

Although in this case, you may find the loan for a bill of exchange ideal, it will most likely ruin your life. Maybe you already have a non-repayment loan with a non-banking company where you basically have nothing wrong. The bailiff may have taken the television and he will receive part of your paycheck, but you still have enough money to survive. If you do not repay the loan for the bill, you will not have anything at all.

Loan in distraint and other non-traditional situations – what are my other options?

We understand. It’s not easy. Especially if you are in one of the above situations. However, whatever you need to borrow, a loan for a bill of exchange cannot, in any case, pay off. Instead, look for non-banking companies that can often help you with your problem. Although non-bank loans often have higher interest rates, the companies that you find in our non-bank loan comparator are licensed by the lender and comply with the applicable laws of the Czech Republic. You’re not going to be broke.

Other possibilities of financial assistance


If you need urgent financial help, there are a few other options to turn to. Not everything is necessarily loans.

  • Agreed – if you owe a bank, service provider or non-banking company, try to agree to postpone installments and other options to resolve your situation before seeking financial assistance.
  • A loan from family – although it is usually not recommended to borrow family and friends, it is definitely a better option than a loan for a bill of exchange. Forget about your pride at least for a while and ask your neighborhood if it helps.
  • Non-bank licensed loan – do not reject a non-bank loan unless you are in execution and have at least a minimum provable income. Although the rules for obtaining a non-bank loan are quite strict, it is definitely worth a try. Only in our non-bank loan comparator, you can find more than 80 companies offering loans to troubled clients.
  • Free legal advice – your situation seems hopeless and you may have already borrowed from usurer? Contact a free legal counsel to help you repair at least the most serious damage.

For example, an American mortgage may be the solution to your seemingly hopeless situation. While using this loan you guarantee your property, which you can easily lose in case of default, but you do not have to worry that in case of problems such a company will not give you a chance, such as postponement of installments, or other arrangements.


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