Promissory Note

A Promissory Note is a legally binding document that outlines a borrower’s promise to repay a specific amount of money to a lender under agreed-upon terms. Key elements include:

1. Names of the borrower and lender

2. Principal amount borrowed

3. Interest rate (if applicable)

4. Repayment schedule and terms

5. Due date for full repayment

6. Any collateral or security (for secured notes)

7. Consequences of default

This document serves as evidence of debt and can be used in various situations, from personal loans to business transactions. It provides clarity on the loan terms and protects both parties’ interests. Promissory notes can be secured (backed by collateral) or unsecured, and may include provisions for early repayment or late fees.

While simple notes can be created without legal assistance, complex transactions may benefit from professional guidance to ensure all necessary clauses are included and the document is enforceable.