I am going to receive a loan from my friend so that I can pay off my mortgage and some other debts. I want to officially record the loan so that my friend is legally protected and guaranteed to be repaid from the equity of the house. How do I record this kind of thing?

  • 1
    WHY are you doing this?
    – RonJohn
    Aug 13, 2019 at 18:57
  • @DStanley that doesn't answer why his friend is loaning him the money when he already has a mortgage.
    – RonJohn
    Aug 13, 2019 at 19:32
  • Ah OK I see what you mean now.
    – D Stanley
    Aug 13, 2019 at 20:04
  • If your friend is not charging interest, or below market interest rate, this could be considered a gift.
    – paulj
    Aug 13, 2019 at 20:09
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    @paulj the forgiven interest payments would be a gift. Almost certainly that would be less than $14K, and so unreported.
    – RonJohn
    Aug 13, 2019 at 20:56

1 Answer 1


You're replacing one loan secured by your house (aka "mortgage") with a different loan secured by your house (aka "mortgage").

You and your friend must write out an official loan contract (amount, interest rate, years, monthly payment, ability to pay early, fees -- if any -- for early payment, and description of the property). Both must sign it in front of witnesses and then file it with the county where your property is located.

Whatever you do... no matter your financial circumstances, pay that note on time every month!!!

  • 1
    Agree with all of this, except that the “file it with the county” is US-centric and we don’t know where the OP is. In the UK I think you’d file this with the land registry buyer I’m not sure. If the OP could update the post with a location I’m sure someone could clarify.
    – Vicky
    Aug 13, 2019 at 20:53

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