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DEPARTMENT FOR AGING AND REHABILITATIVE SERVICES AUXILIARY GRANT PROGRAM NON-SSI RESOURCE ELIGIBILITY 11/18 CHAPTER E PAGE 99 53. Promissory Notes and Property Agreements Promissory Note A promissory note is a written, unconditional agreement whereby one party promises to pay a specified sum of money at a specified time (or on demand) to another party. It may be given in return for goods, money loaned, or services rendered. Property Agreement A property agreement is a pledge or security of particular property for the payment of a debt or the performance of some other obligation within a specified period. Property agreements on real estate generally are referred to as mortgages but also may be called real estate or land contracts, contracts for deed, deeds of trust, and so on. Personal property agreements (e.g., pledges of crops, fixtures, inventory, etc.) are commonly known as chattel mortgages. Negotiable Agreement A negotiable agreement is an agreement whereby the ownership of the instrument itself and the whole amount of money expressed on its face can be transferred (e.g., sold) from one person to another. 53.1. For the Buyer (Debtor) For the buyer of the property (debtor), the promissory note is not a resource. However, the property purchased may be a countable resource in the month following the month of the transaction. 53.2. For the Seller (Creditor) For the owner of the agreement (the seller), a promissory note or property agreement is a resource. The property itself is not a resource because the seller cannot legally convert it to cash while it is encumbered by the agreement. 53.2.1. Property Agreements Prior to Settlement An individual who enters into a contract for the sale of real estate owns two items until the settlement of the sale is completed: the real estate and the contract. The real estate is not a resource because the seller cannot legally convert it to cash while it is encumbered by the contract. The real estate contract is a property agreement that is a resource to the seller.