Promissory Note Guides
105 articles in this category
How to Write a Promissory Note for a Car Loan Between Individuals
Selling a car to someone who pays you over time turns you into a lender, and a handshake is a terrible loan. A promissory note spells out the payments, the interest, and what happens if they stop paying, while the title question decides whether you actually get paid.
Installment vs. Demand Promissory Note: How to Choose
Two promissory notes can lend the same amount at the same rate and still work in completely different ways, because the repayment structure is where the real difference lives. An installment note sets a fixed schedule. A demand note lets the lender call the loan whenever they want. Choosing between them shapes the entire loan.
What Interest Rate Can You Legally Charge? Usury Limits Explained
Charging interest on a loan is legal and often sensible, but every state sets a ceiling, and crossing it can do far more than void the interest. In some states it costs you the right to collect the loan at all. Here is how usury limits work and how to set a rate that actually holds up.
Secured vs. Unsecured Promissory Note: Which One Do You Need?
Every promissory note answers one question before any other: if the borrower stops paying, what can the lender actually do about it? The answer depends almost entirely on whether the note is secured or unsecured, and a lot of lenders make that choice without realizing what they are giving up.
Does a Promissory Note Mean You Got the Loan?
You applied for financing, went through the process, and now someone has handed you a promissory note to sign. Does that mean you're approved? Is signing the note the moment the loan becomes real, or is it just one more form in a process that could still fall through? The answer matters, because people sometimes treat signing a promissory note as a formality when it's actually one of the most consequential moments in the entire borrowing process...
What Is a Promissory Note in Real Estate?
When you buy a home with a mortgage, you sign a stack of documents at closing thick enough to make your hand cramp. Buried in that stack is the one document that actually creates your obligation to repay the money: the promissory note. Most buyers never read it closely, never get a copy that registers in their memory, and couldn't tell you the difference between the note and the mortgage. But in real estate, the promissory note is the document that matters most, and understanding what it does clears up a lot of confusion about how home financing actually works...
How to Create a Promissory Note Online (And Make Sure It Holds Up)
You can create a promissory note online in a few minutes, and it carries the same legal weight as one a lawyer drafts. The difference between a note that protects you and one that doesn't comes down to what goes into it. Here's how to get it right.
Who Holds the Promissory Note While It's Being Repaid?
The note is signed, the money has changed hands, and now there's a physical document that represents the debt. Who keeps it? Does the lender hold it? The borrower? Both? A neutral third party? It's a practical question that doesn't get much attention until something goes wrong, and the answer has real implications for how the loan gets enforced, repaid, and ultimately closed out...
Can I Make My Own Promissory Note?
You need to document a loan and you're wondering whether you can just write the promissory note yourself, or whether this is one of those situations that requires a lawyer, a specific form, or some kind of official filing. The good news: yes, you can absolutely make your own promissory note, and for most loans it's the right approach. The catch is that "can" and "should do it carelessly" aren't the same thing.
Does a Promissory Note Need a Witness to Be Valid?
You've drafted the note, both parties are ready to sign, and someone asks whether you need a witness to make it official. Maybe a relative remembers signing important documents in front of witnesses. Maybe you've seen it in movies. The question is reasonable, and the answer surprises a lot of people: in nearly every case, no, a promissory note does not need a witness to be valid...
Can You Change the Terms of a Promissory Note After Signing?
Life changes after a loan is made. The borrower loses a job. The lender needs the money back sooner than expected. Both parties agree the interest rate was too high. Whatever the reason, one or both parties want to adjust the terms of a promissory note that's already been signed, and the question is whether that's even possible and how to do it without creating a legal mess...
Can a Minor Sign a Promissory Note?
It comes up more often than you'd think. A parent co-signs a loan for a teenager buying a car. A grandparent lends money to an 17-year-old heading to college. A young entrepreneur borrows startup funds before their 18th birthday. In each case, someone is wondering whether a promissory note signed by a person under 18 is actually enforceable, or whether the whole document can be unwound the moment the minor decides they don't want to honor it...