A promissory note turns a handshake loan into a clear, enforceable promise. It’s ideal for loans between family, friends or a business and an individual.
Free Promissory Note template
Fill in the blanks: the document updates as you type. Nothing you enter leaves your browser.
Promissory Note
Amount: $____ Date: ____
For value received, ____ of ____ ("Borrower") promises to pay ____ ("Lender") the principal sum of $____, with interest at ____% per year on the unpaid balance.
1. Payments
Borrower will repay as follows: ____. All unpaid principal and interest is due no later than ____.
2. Prepayment
Borrower may prepay all or part of the balance at any time without penalty.
3. Late payments
A late fee of ____ applies, to the extent permitted by law.
4. Default
If Borrower misses a payment by more than 30 days, Lender may declare the entire unpaid balance immediately due after giving written notice. Borrower agrees to pay reasonable costs of collection where permitted by law.
5. General
This Note is governed by the laws of ____. If any provision is unenforceable, the rest remains in effect. Interest will never exceed the maximum allowed by law.
Borrower: __ Date: __
Lender: __ Date: __
This free template is general information, not legal advice, and may not suit your state or situation. Some documents must be signed before witnesses or a notary. For anything important, have a lawyer review it.
Promissory note vs loan agreement
A promissory note is a short, one-sided promise to pay. A personal loan agreement is a longer two-sided contract with more terms. For simple loans, a note is usually enough.
Interest
Every state has usury laws that cap interest rates for some loans. For large family loans, the IRS may expect at least a minimum “applicable federal rate” to avoid gift-tax issues: ask a tax professional.
Secured or unsecured
This template is unsecured. If the loan is backed by collateral (like a car), you’ll need a security agreement too.
Frequently asked questions
Does a promissory note need to be notarized?
Usually not, but notarizing can make it harder to dispute the signature later.
Questions from readers
Question about the Promissory Note? Ask it here. We answer common questions in general terms on this page. This is not legal advice.
