Checklist - Items to Consider for Drafting a Promissory Note
What is this form?
A checklist for drafting a promissory note provides essential items to consider when creating a legally binding payment agreement. This form helps ensure that all critical components are included, differentiating it from similar agreements. A promissory note is a written promise to pay a specified sum of money to a designated person at a future date or on demand.
What’s included in this form
- Date of execution
- Place of execution
- Time of performance
- Place of performance
- Indication of consideration
- Identification of maker, including joint liability details (if applicable)
- Name or identification of payee
- Unconditional promise of payment
- Sum certain in money
- Provisions regarding interest rate, if applicable
- Provisions regarding security for the note
- Installment payment provisions
- Default and acceleration provisions
- Governing law for enforcement of the note
- Signatures of all parties with identifiable information
When to use this document
This checklist should be used when creating a promissory note to ensure that all necessary terms and legal requirements are included. It is particularly useful when lending money to friends, family, or business associates, or when formalizing a loan agreement. Use this form whenever you need a clear and enforceable written promise regarding repayment terms.
Who this form is for
- Individuals lending money to friends or family
- Business owners extending credit to clients
- Investors creating financial agreements
- Any party seeking a reliable payment plan
Steps to complete this form
- Identify all parties involved in the promissory note.
- Specify the amount being loaned and any interest rate.
- Indicate the repayment terms, including due dates and places of payment.
- Include the date and place where the agreement is executed.
- Ensure all parties sign the document, identifying their roles.
Notarization requirements for this form
Notarization is not commonly needed for this form. However, certain documents or local rules may make it necessary. Our notarization service, powered by Notarize, allows you to finalize it securely online anytime, day or night.
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Make edits, fill in missing information, and update formatting in US Legal Forms—just like you would in MS Word.
Download a copy, print it, send it by email, or mail it via USPS—whatever works best for your next step.
Sign and collect signatures with our SignNow integration. Send to multiple recipients, set reminders, and more. Go Premium to unlock E-Sign.
If this form requires notarization, complete it online through a secure video call—no need to meet a notary in person or wait for an appointment.
We protect your documents and personal data by following strict security and privacy standards.
Common mistakes to avoid
- Failing to specify the interest rate or repayment terms.
- Not including signatures from all involved parties.
- Omitting the date of execution, which can affect enforceability.
- Not recognizing state-specific requirements for promissory notes.
Benefits of using this form online
- Convenience of downloading and editing the form whenever needed.
- Access to templates drafted by licensed attorneys for reliability.
- Time-saving process compared to traditional legal consultations.
- Ability to customize the checklist for personal or business needs easily.
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FAQ
A promissory note is a contract, a binding agreement that someone will pay your business a sum of money. However under some circumstances if the note has been altered, it wasn't correctly written, or if you don't have the right to claim the debt then, the contract becomes null and void.
A promissory note basically includes the name of both parties (lender and borrower), date of the loan, the amount, the date the loan will be repaid in full, frequency of loan payments, the interest rate charged on the loan payments, and any security agreement.
Date. The promissory note should include the date it was created at the top of the page. Amount. Loan terms. Interest rate. Collateral. Lender and borrower information. Signatures.
Promissory notes are one of the simplest ways to obtain financing for your company. They are often basic documents with few formalities.As such, a promissory note must contain the usual standard requirements for a contract, including consideration, meeting of the minds and capacity.
In order for a promissory note to be valid, both the lender and the borrower must sign the documentation. If you are a co-signer for the loan, you are required to sign the promissory note. Being a co-signer requires you to repay the loan amount in the instance that the borrower defaults on payment.
In the context of a promissory note, the promisor usually obtains consideration in the form of a loan, and the promisee receives consideration in the form of the promise to repay under the terms specified in the note.
Full names of parties (borrower and lender) Repayment amount (principal and interest) Payment plan. Consequences of non-payment (default and collection) Notarization (if necessary) Other common details.
Only legal tender money is acceptable as promissory note. Rare currencies or coins wouldn't be taken as valid promissory notes. The amount to be paid should also be certain. It is not payable to bearer It is illegal to make promissory note payable to bearer under the provisions of the RBI Act.
Full names of parties (borrower and lender) Repayment amount (principal and interest) Payment plan. Consequences of non-payment (default and collection) Notarization (if necessary) Other common details.
