A simple promissory note might be for a lump sum repayment on a certain date. For example, let's say you lend your friend $1,000 and he agrees to repay you by December 1st. The full amount is due on that date, and there is no payment schedule involved.
I, [Borrower's Name], residing at [Borrower's Address], hereby promise to pay [Lender's Name], residing at [Lender's Address], the sum of $[Amount] with an interest rate of [Interest Rate]% per annum.
State what each side agrees to do. Clearly write out the terms of the loan. Include information about the date of the loan, the payment terms, interest, schedule of payments, late charges, default, and any other details in the agreement. Explain that the contract represents the entire agreement.
You can use a template or create a promissory note online. But before you begin, you'll need to gather some information and make decisions about the way the loan will be structured. First, you'll need the names and addresses of both the lender (or "payee") and the borrower.
But what exactly do you need to write a promissory note? Include their full legal names, addresses, and contact numbers—include any co-signers if applicable. The terms of this note should specify the amount borrowed, repayment terms (including interest rate, if applicable), and the due date or schedule of payments.
Promissory notes don't have to be notarized in most cases. You can typically sign a legally binding promissory note that contains unconditional pledges to pay a certain sum of money. However, you can strengthen the legality of a valid promissory note by having it notarized.
If you are creating a lump-sum payment provision with interest, use this language: "In return for a loan Borrower has received from Lender, Borrower promises to pay to Lender the amount of $[loan amount - principal], plus interest on unpaid principal at the rate of [interest rate]% per year from the date this note is ...
A “Promise to Pay Agreement,” also known as a promissory note, is a financial instrument that contains a written promise by one party (the promisor or maker) to pay another party (the promisee or payee) a definite sum of money, either on demand or at a specified future date.
A promissory note is a financial instrument that contains a written and signed promise between two parties to repay a sum of money in exchange for a loan or other financing.
Promissory notes are quite simple and can be prepared by anyone. They do not need to be prepared by a lawyer or be notarized. It isn't even particularly significant whether a promissory note is handwritten or typed and printed.
A repayment agreement is a legally binding contract between two parties, outlining the terms and conditions for the repayment of a loan or debt. This type of agreement specifies the amount borrowed, the interest rate (if any), the repayment schedule, and any other relevant terms.
Promissory notes are legally binding contracts that can hold up in court if the terms of borrowing and repayment are signed and follow applicable laws.
This is called a Demand Letter. This is a step you must take before filing a small claims court case. If you ask for the money and the other side pays you, you won't need to go to court.
Don't Be Threatening
While the dispute of payment may have become personal, a demand letter is meant to encourage a desirable resolution. The use of threatening or insulting language may embolden the owner into not paying when they otherwise would have. And remember, a judge may one day look at this letter in court.
Yes, you may notarize a signature on a document that includes handwritten paragraphs. A document can be typed or handwritten. If the notarial certificate under the signature is not included, be sure to attach a loose certificate chosen by your customer.
An IOU is a legal document that can be introduced in a court of law—though whether or not it is binding is open to dispute. Some authorities feel an IOU isn't binding at all; it's merely the acknowledgement that a debt exists. Others feel it is binding, though whether it can actually be enforced is a different story.
A promissory note could become invalid if: It isn't signed by both parties. The note violates laws. One party tries to change the terms of the agreement without notifying the other party.