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Family Member Promissory Note for Switzerland

Family Member Promissory Note Template for Switzerland

A Family Member Promissory Note under Swiss law is a formal legal document that establishes and documents a loan agreement between family members. The document is structured in accordance with the Swiss Code of Obligations (OR/CO) and Swiss Civil Code (ZGB/CC), incorporating specific provisions for familial financial arrangements. It details the loan amount, repayment terms, any applicable interest rates, and default provisions while considering the unique aspects of intra-family lending. The document ensures legal enforceability while maintaining the flexibility often needed in family financial arrangements, and includes specific provisions for Swiss tax compliance and debt enforcement regulations.

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Family Member Promissory Note

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What is a Family Member Promissory Note?

The Family Member Promissory Note is essential for documenting financial loans between family members in Switzerland, providing a clear legal framework while acknowledging the unique nature of family relationships. This document is particularly useful when family members wish to formalize financial arrangements, whether for business investments, property purchases, education funding, or other personal needs. The note must comply with Swiss legal requirements, including the Swiss Code of Obligations and relevant tax regulations, while maintaining flexibility for family circumstances. It includes comprehensive details about the loan terms, repayment schedule, interest provisions (if any), and default procedures, all tailored to meet Swiss legal standards. The document is designed to protect both the lending and borrowing family members' interests while potentially offering more favorable terms than commercial loans.

What sections should be included in a Family Member Promissory Note?

1. Parties: Identification of the lender and borrower, including full legal names, addresses, and relationship

2. Background: Brief context of the family loan arrangement and purpose of the loan

3. Definitions: Key terms used in the document, including 'Loan Amount', 'Interest Rate', 'Payment Date', etc.

4. Loan Amount and Purpose: Specific amount being lent and detailed purpose of the loan

5. Repayment Terms: Schedule of repayments, including payment amounts, frequency, and final maturity date

6. Interest: Interest rate (if applicable), calculation method, and payment schedule

7. Method of Payment: Acceptable payment methods and payment instructions

8. Prepayment: Terms and conditions for early repayment of the loan

9. Default Provisions: Consequences of missed payments or other defaults

10. Representations and Warranties: Basic statements about the capacity to enter into the agreement

11. Notices: How and where formal communications between parties should be made

12. Governing Law: Confirmation of Swiss law application and jurisdiction

What sections are optional to include in a Family Member Promissory Note?

1. Security: Include when the loan is secured by specific assets or collateral

2. Guarantor Provisions: Include when a third family member is guaranteeing the loan

3. Death or Incapacity: Include specific provisions for handling the loan in case of death or incapacity of either party

4. Tax Provisions: Include when there are specific tax implications to be addressed, particularly for interest-free loans

5. Dispute Resolution: Include when parties want to specify mediation or alternative dispute resolution before court proceedings

6. Amendment Process: Include when flexibility for future changes to terms is desired

7. Financial Hardship Clause: Include provisions for temporary payment modifications in case of financial difficulties

What schedules should be included in a Family Member Promissory Note?

1. Repayment Schedule: Detailed table of payment dates and amounts

2. Interest Calculation Examples: If applicable, examples showing how interest is calculated

3. Asset Documentation: If loan is secured, details and documentation of security

4. Related Family Agreements: Any related family arrangements that affect this loan

5. Proof of Funds: Documentation showing the source and transfer of the loan amount

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Switzerland

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions






























Clauses

























Relevant Industries

Private Banking

Wealth Management

Family Office Services

Legal Services

Financial Services

Tax Advisory

Estate Planning

Private Client Services

Relevant Teams

Legal

Wealth Management

Private Banking

Tax Advisory

Compliance

Estate Planning

Financial Planning

Private Client Services

Family Office Services

Relevant Roles

Private Banker

Wealth Manager

Family Office Manager

Legal Counsel

Tax Advisor

Estate Planner

Financial Advisor

Trust Officer

Relationship Manager

Compliance Officer

Private Client Lawyer

Financial Planning Consultant

Family Business Advisor

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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