Why Do You Need Personal References for a Master Promissory Note?

Whether you're planning to attend school soon and need loans for tuition or you just need to borrow funds to cover personal needs, chances are you will need to sign a promissory note. The fulfillment of a promissory note application often requires that you list personal references as part of the process.

Master Promissory Note

A master promissory note (MPN) is usually associated specifically with student loans, like the Stafford, Perkins or PLUS loans extended by the government to some students in need. The MPN helps speed along the application process for all loan programs, since it often covers a number of school loans under one document.

Personal References

When filling out a master promissory note you may have to include one or more personal references. These references may include a grandparent, sibling or other relative. The general requirement is that the personal reference must be an adult older than 21 who you have known for at least three years and does not live in your home. It cannot be another student or either of your parents. You must provide the full name, address and phone number for each personal reference.

Why Are References Needed?

In many cases, you're required to provide personal references on your master promissory note because the lender (or Department of Education) wants information about other people to contact in case you are unavailable. Additionally, after graduation day sometimes students move away and the lender cannot locate them with notices. In some cases the lender may also call the references to verify the information at the time of application.

Concerns

Be aware that when you add references to a master promissory note the lender will likely use them if necessary. This means if you default on the loan or have other issues the lender may try to contact those personal references listed via mail or phone. Take care to only add someone you really trust and who does not mind being contacted regarding the account.

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