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Tina
Tina, Lawyer
Category: Legal
Satisfied Customers: 33166
Experience:  JD, BBA Over 25 years legal and business experience.
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In Pennsylvania must a personal loan over $50,000. be in writing

Customer Question

In Pennsylvania must a personal loan over $50,000. be in writing with signature of recipient even though lender put "loan" on fron of check--and if violative of statute of Frauds-would ir be non enforceable and considered a gift?
Submitted: 3 years ago.
Category: Legal
Expert:  Tina replied 3 years ago.

Hello and welcome.

My name is XXXXX XXXXX my goal is to provide you with excellent service today. I am working on your answer now and will post it here shortly. Thank you for your patience while I prepare your answer.

Expert:  Tina replied 3 years ago.
Hello again, John.

The statute of frauds does not typically apply to personal loans. The following section of the PA code refers to the general requirements under the statute of frauds:

§ 2201. Formal requirements; statute of frauds. (a) General rule.--Except as otherwise provided in this section a contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this subsection beyond the quantity of goods shown in such writing.

Here is a link to this section of the code:

http://law.onecle.com/pennsylvania/commercial-code/02.022.001.000.html

Therefore, the agreement could be enforceable as an oral contract since the statute of frauds does not apply and the notation on the check would typically constitute evidence that the funds were a loan and not a gift.

I hope this helps clarify the situation for you. Please remember to rate my service once you have all the information you need so I will be compensated for my time from the deposit you posted with this website. If you have any other questions, please ask me – I’ll be happy to respond. Thank you!

Tina

Expert:  Tina replied 3 years ago.
Hello again,
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Tina