Free Promissory Note Form Template
On this page, you'll find promissory note forms for each state that you can use to document an agreement to borrow money from someone else.
What is a Promissory Note?
A promissory note is used when you have an agreement to borrow money from another party, and you want to document that agreement with specific time-periods for the repayments, as well as the interest rate agreed, any penalties for late repayment, plus any other terms that both parties agree to.
When the promissory note has been fully paid, the lending party will sign and issue a release form. This is a receipt which confirms that the promissory note has been fully repaid and there is no further financial obligation for the borrower.
Types of Promissory Notes
The two main types of promissory note you'll find are:
- Secured Promissory Note. This is a promissory note that is secured by an asset, such as a house or car. If the borrower fails to pay the loan, the lender will be able to recover the loan by selling the asset.
- Unsecured Promissory Note. This is a promissory note that is not secured by an asset, such as a house or car. If the borrower fails to pay the loan, the lender will not be able to recover the loan and would need to take legal action.
Download Free Promissory Note Form
Use the link below to download the free PDF of the standard promissory note template.
Standard Promissory Note Form Download PDF
Promissory Note Forms by State
Alternatively, use the links below to download the free promissory note forms for each state.
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia
How to Write a Promissory Note
Promissory notes are a legal document, but writing one doesn't have to be complicated.
In order to properly document the agreement to lend money from one party to another, the promissory note should have the following elements:
- The date of the agreement
- The name and address for borrower and lender
- The principal amount of the loan
- Whether the loan is secured or unsecured
- If the loan is secured, what is the collateral asset?
- In what circumstances can lender take possession of the collateral asset?
- The repayment schedule
- The due date for payments
- The interest rate
- Whether the loan has a cosigner, and if so, who is it?
These are the basic details required, although we would recommend using a form that has already been created to save you time researching the necessary details.
It's also worth nothing that you should check the usury laws in your state before deciding on the interest rate for the loan.
Each state has its own laws for the maximum interest you can apply to the loan, and you need to adhere to these laws to ensure that the agreement is legal.
Signing Promissory Notes
Although it is not necessary for the document to be legally valid, it is recommended that you have a lawyer who is licensed to practice in your state check the promissory note agreement to make sure it is legally sound and does not violate state laws.
When you're happy with the promissory note, the lender, borrower, and any cosigners should sign it. You can also have a lawyer notarize it for you (in the event of a court case this proves no signatures were forged).
Keep a copy of the promissory note for your records and make sure to keep it safe. We recommend an online copy stored in Google Drive or similar, a copy on your hard drive, and a physical copy in a locked filing cabinet.
Making Changes to a Promissory Note
It is possible that changes to the agreement may be needed, particularly for longer repayment periods. To do this, all parties must agree.
The best practice is to create a second promissory note as an amendment to the original. This way, you can highlight the changes being made, and have all parties sign it just as you did before.
Hopefully this article has helped you understand how to write a promissory note for your agreement.
You can use the templates above as a guide and always consult a lawyer where possible to ensure you are following state laws.
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