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Delaware Unsecured Promissory Note

Create Delaware Unsecured Promissory Note - $7.99

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Generate a legally proper Unsecured Promissory Note for Delaware that incorporates all required terms under Delaware promissory note law. Fill in your loan details and download your completed, ready-to-sign Unsecured Promissory Note as a professional PDF.

Delaware law governs promissory notes with specific usury limits and enforcement rules that protects both lending party and debtor. The usury limit in Delaware is 5% above Federal Reserve discount rate. Lenders have 6 years to file suit to collect on a promissory note in Delaware. Delaware law requires 3 specific elements in a valid promissory note.

Delaware Promissory Note Requirements

Max Interest Rate 5%
Rate Details 5% above Federal Reserve discount rate
Usury Penalty Forfeiture of the excess; borrower may recover treble the overcharge if suit is brought within one year
Statute of Limitations 6 years
Notarization Recommended
Witnesses Recommended (1)
Governing Agency Delaware Superior Courts
Required Elements Written agreement signed by borrower; Clear repayment terms; Interest rate disclosure

Delaware Unsecured Promissory Note Signing Checklist

Print this or save it as a PDF and use it at the signing. Review every item before any party puts pen to paper.

Before you sign

  • Both the lender and borrower read the full note before signing.
  • Confirm the principal amount, interest rate, and repayment terms match what was agreed.
  • Confirm any late fee amount and grace period are correct.
  • The lender keeps the original signed note in a safe place.
  • Each party keeps a signed copy for their own records.

Delaware rules to know

  • Keep the interest rate at or below Delaware's usury cap of 5% per year (5% above Federal Reserve discount rate).
  • Notarization is not required in Delaware but is strongly recommended. A notarized note is self-authenticating in court and harder to dispute.
  • 1 witness is recommended in Delaware even though not legally required.
  • In Delaware, the lender has 6 years from the date of default to file suit to collect on the note.

In the note itself

  • Borrower's full legal name and current address.
  • Lender's full legal name and current address.
  • Principal loan amount written out in both numbers and words.
  • Annual interest rate (expressed as a percentage).
  • Maturity date (the date by which the full balance must be repaid).
  • Late fee amount and grace period, if any.
  • Signatures of both parties (and witnesses if required).
  • A clear statement that no collateral secures this note and the lender relies solely on the borrower's promise to repay.

This checklist is a reference aid only. Consult an attorney for advice specific to your situation. Usury and enforcement rules for Delaware may change; verify current rates before signing.

What to Include in a Delaware Unsecured Promissory Note

Every Unsecured Promissory Note in Delaware should include the following critical provisions: the full legal names and addresses of both the lender and obligor, the principal loan amount, the interest rate (which must not exceed 5% above Federal Reserve discount rate under Delaware law), the repayment schedule and due dates, any late payment penalties, the consequences of default, and the governing law clause.

Delaware requires the following elements in a valid promissory note: written agreement signed by borrower, clear repayment terms, interest rate disclosure.

How to Complete a Delaware Unsecured Promissory Note

To complete a Unsecured Promissory Note in Delaware, start by gathering the necessary information: the full legal names and addresses of both parties, the loan amount, the agreed-upon interest rate (must be at or below 5% above Federal Reserve discount rate in Delaware), the repayment terms, and any collateral details if applicable.

Our platform walks you through each section with a guided form tailored to Delaware requirements. Once you have filled in all details, you can preview the document, choose from five professional document styles, and download your completed Unsecured Promissory Note as a PDF.

Frequently Asked Questions

What is the maximum interest rate for a promissory note in Delaware?
Delaware caps interest at 5% above Federal Reserve discount rate. Charging above the legal limit is usury - in Delaware, the penalty is: forfeiture of the excess; borrower may recover treble the overcharge if suit is brought within one year. Always confirm the current rate with an attorney, as usury laws can change.
Do I need a notary for a promissory note in Delaware?
Notarization is not required in Delaware for a promissory note to be legally valid. Notarizing it anyway is strongly recommended - it deters forgery claims, simplifies court enforcement, and makes the note self-authenticating as evidence. Having 1 witness is also recommended.
What happens if a borrower defaults on a promissory note in Delaware?
Upon default, the lender may demand immediate repayment of the full outstanding balance, charge any default interest rate specified in the note, and file suit in Delaware court. Lenders have 6 years from the date of default to file a lawsuit under Delaware's statute of limitations for written contracts.
Is an unsecured promissory note enforceable in Delaware?
Yes. An unsecured promissory note is a legally enforceable contract in Delaware even without collateral. If the borrower defaults, the lender can sue in Delaware court and obtain a judgment, which can be used to garnish wages or bank accounts. Lenders have 6 years to file suit.
Is a promissory note the same as an IOU?
No. An IOU is an informal acknowledgment of a debt - it typically lacks repayment terms, interest rates, and default provisions. A promissory note is a formal legal contract with specific terms including the loan amount, interest rate, repayment schedule, and consequences of default. Promissory notes are far more enforceable in court than informal IOUs.
Is a promissory note legally binding in Delaware?
Yes. A properly executed promissory note is an enforceable contract in Delaware. It must identify both parties, state the loan amount and repayment terms, and be signed by the borrower. Lenders have 6 years to pursue legal action to collect on a defaulted note.
Why is Delaware known for having no usury cap?
Delaware has no general usury cap for written contracts between parties (5 Del. C. §2301) - parties may agree to any interest rate in writing. This is a major reason why major credit card companies (Citibank, JPMorgan Chase) incorporated in Delaware: they can charge any interest rate to cardholders nationwide under the "most favored lender" doctrine. For private promissory notes, Delaware's freedom of contract means your agreed rate is enforceable without a statutory ceiling. For a negotiable promissory note, Delaware applies the Uniform Commercial Code six-year period (6 Del. C. 3-118).

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