Money is a necessity nowadays, especially now that commodity prices have been rising fast yet benefits and compensation payments are still meager and not enough to pay bills and buy food. That is why we are turning to personal loans and bank financing to sustain our needs. However, if you are one of those lenders who want to be assured that every penny you lend to a borrower will be paid with or without interest, it would be best to prepare yourself a money promissory note. Learn how to make a promissory note by reading through this article.
14+ Money Promissory Note Samples
1. Money Promissory Note Example
2. Substitute Promissory Note for Money
3. Money Promissory Note and Receipt
4. Money Promissory Note Example
5. Substitute Promissory Note for Money
6. Money Promissory Note and Receipt
7. Money Promissory Unconditional Prom Note
8. Money Demand Promissory Note
9. Money Promissory Note as Payment Security
10. Money Loan Promissory Note Agreement
11. Money Demand Promissory Note Set
12. Standard Money Promissory Note
13. Cheque vs Money Promissory Note
14. Master Money Promissory Note
15. Secured Promissory Note Agreement
What Is a Money Promissory Note?
A money promissory note is a type of contract agreement containing a borrower’s oath to pay a certain amount of money they owe to a lender. The borrowed amount may be used for different purposes such as personal loans, mortgage payoff, student loans, medical loans, and in situations where the borrower is in need of instant cash. A promissory note is a legal document and thus can be presented to the court by the lender in case the borrower fails to pay the amount and interest that was stipulated in the agreement.
How To Write a Money Promissory Note?
Are you in need of a promissory note for your transaction today? If that is so, we recommend that you download a template so you can start your task efficiently. You can also download a word processing application where you can draft your promissory note. Begin writing it now by following the instructions and tips below.
1. Always Put a Date
When it comes to contracts and legal documents, dates are very important. Dates indicate the time when both parties have been legally bound to each other by a contract. The dates also help you remember when payment dues are or when the contract is supposed to end. By not following the agreement beyond these dates, the lender has now the right to pursue a case against the borrower depending on the contract’s stipulations or terms and conditions.
2. Indicate Lender and Borrower Information
Another vital information that you should include in the promissory note is the contact information of both the borrower and the lender. Here, write the complete names, addresses (can be home or office addresses), and other information that you may deem important, especially if you want to make a background check on the identity of the borrower.
3. Write the Exact Loan Amount
Next, write down the amount the borrower wishes to borrow from you. If you want to apply an interest rate on a specific loan amount, you also need to indicate that. You can also provide them a breakdown so that they would understand why their payment obligations to you exceed the loan amount that they are borrowing.
4. Specify If the Loan is Unsecured or Secured
Some lenders, especially those who are operating without business licenses, usually prefer to loan agreements that are unsecured. This is because in the case that the borrower fails to repay their obligations, they cannot go after them and in the end, their business might be jeopardized. However, for those who are legitimate lending companies, they would usually ask for collateral so that under any and under circumstances, the borrower may still be able to repay the loan. These collaterals may be real estate property, prized assets, or anything that has the same value as the loan amount.
5. Write the Payment Dates
Last but not least, let the borrower know when you expect them to pay, either on a daily or monthly installment, with a specified amount. If they are unable to pay on or before the due date indicated on the document, then they would need to pay an additional amount as part of the late payment fees.
What are the other things I should need to indicate in my promissory note?
Another important part of a promissory note is the information of a co-signer if there is any. A co-signer will act as the guarantor that the borrower will definitely pay the loan amount as agreed.
What are co-signers?
Co-signers are those individuals who are also required to pay the exact amount as those loaned by the principal borrower. Co-signers are mostly family members, friends, and or co-workers of the borrower. In case the borrower fails to pay the lender, they would be the one to take responsibility for paying back the owed money.
Why should we use promissory notes when lending money?
Nowadays, money is important and very hard to earn. If you do not want to be taken advantage of by your borrowers or get scammed, you definitely need a promissory note to back you up in case you want to bring them to court for claims.
To secure your lending business and that you are getting back what was owed to you by another entity, it would be best to get a written instrument to seal the deal. Download our editable and professionally-created money promissory notes by checking out our website and sample templates in this article.
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