What Is Long Term Note (LTN)?

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What Is Long Term Note (LTN)?
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• The long term note (ltn) is a credit instrument
  that implies a future payment commitment on a
  specific date and place and is also one of the
  most common forms of payment in commercial
  transactions, especially between companies. In
  addition, it allows you to obtain circulating
  financing through your advance both in the
  banking and non-banking circuits.
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• The promissory note is regulated by the Exchange
  and Check Law, which equates the promissory note
  to the exchange bill in almost all its
  characteristics, including the executive force.
  Since then, the promissory note began to gain
  ground to the bill of exchange in commercial
  transactions due to its simplicity and its better
  adaptation to computer advances.

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• Being regulated, it is a widely accepted form of
  payment that is easy to finance, both in
  financial facilitators like the banking circuit
  and outside of it, making it a powerful financing
  tool for companies.
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• Long term note (ltn) requirements
• The Exchange and Check Law establishes some
  minimum requirements that must appear in the
  document so that it can be considered as a
  promissory note
•   It must be in writing that it is a promissory
  note, and in the same language as the rest of the
  document. It must contain the unconditional
  commitment to pay in a fixed amount. Typically,
  this amount appears in numbers and letters,
  although the letter always prevails in case of
  inconsistency. You must indicate the due date
  and the place to make the payment. It must
  contain the name of the beneficiary of the
  financial facilitators.

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• The date and place of issuance of the document
  must appear. It must include the personal
  signature of the natural or legal person who
  agrees to pay.
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• I will pay to order and I will pay not to order
• A promissory note will be considered not to
  order when there is express mention of this
  clause in the document
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• I will pay not to order when the document
  includes this mention, it cannot be transmitted
  to third parties by endorsement but must be
  transmitted by assignment of credit. This small
  change is very important, since, formally, a
  credit assignment must be reliably communicated
  to the issuer of the promissory note, and the
  latter can oppose its transmission.

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• Promissory note if a promissory note does not
  expressly contain the clause not to order, it
  is considered to be made to order. This means
  that it can be transmitted to a third party
  without consent or communication to its issuer.
  The endorsement is carried out in a very simple
  way by signing the document by the endorser and
  the endorsee on its back and without the need for
  communication to the issuer, who cannot oppose
  the transmission of the document.
• Advantages and disadvantages of the promissory
  note by financial facilitators
• Advantages of the promissory note
• For the recipient, it is a firm payment
  promise, with enforceability in the event of
  non-payment. There are many ways to finance the
  collection, both at the bank and non-bank levels,
  due to their wide acceptance and regulation.
  The creditor has control over the issuance of the
  document, which is an advantage for him. Long
  term note (ltn) is a very flexible document, it
  allows its transmission in a simple way and it
  can be guaranteed by the endorsement of third
  parties.

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