Promissory Note

Share This
Wikis > Promissory Note

Definition

A promissory note is a traditional signed legal document outlining a loan’s repayment schedule – its formal tone will set loan expectations, as well as encourage borrowers to successfully repay loans. It is the only legal document absolutely necessary to formalize a loan.

There are some key issues that should be considered when discussing the terms of your loan. The promissory note should include, in detail:

1. The names of the borrower and lender

2. Payment frequency and timeframe

3. Amount per payment

4. Interest Rate

5. Consequences of missed or late payments

6. Offered Collateral

Category: