Free Promissory Note

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  • Complete a short questionnaire.
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  • Sign at your convenience.
Promissory Note Details
Check to Show Hints for Completing this Form

This software has the flexibility to let you quickly create the Promissory Note you want. It does this by providing many options with appropriate defaults.
One common default is 'Do Not Specify'. This default means that the finished document will not have a clause dealing with that topic. The benefit of not specifying is that you get a shorter and simpler document; however, the document will be less precise. Also, in some cases, the issue is not even applicable. For example, if you do not wish to discuss whether the borrower can pay the outstanding principal without penalty, then it is appropriate to pick 'Do Not Specify' for that question.
If you want to fill in a particular item after you have printed the document, you can enter underscore characters (ie. _____).
Governing Law

Country where Lender resides:
Q. What is the governing law for a Promissory Note? A. The governing law is the law of the jurisdiction in which the promissory note will be entered into. Often the parties select the jurisdiction where the Lender resides. If the promissory note relates to the purchase of certain assets, then the location of those assets is selected.
Lender Q. Who is the Lender? A. The Lender is the person or corporation that gives something of value (money, property or some service) to the Borrower on condition that the Lender will be paid a certain amount in the future.
Name:
Borrower Details Q. Who is the Borrower? A. The Borrower is the person or corporation that receives value (money, property or some service) from the Lender on the condition that the Borrower will pay the principal amount plus any interest to the Lender at sometime in the future.
Number of Borrowers:
BorrowerFirst Borrower
Name:
Address:
Gender:


BorrowerSecond Borrower
Name:
Address:
Gender:


BorrowerThird Borrower
Name:
Address:
Gender:


BorrowerFourth Borrower
Name:
Address:
Gender:

Is the borrower using the proceeds of this loan for a business purpose? Yes No Loan proceeds that are for a business purpose cannot be used for household or personal purposes.
Principal
Principal Amount: £  (e.g. 1,000.00) Q. What is the Principal amount? A. The principal is the original amount of the note that is owed by the Borrower to the Lender on the date the Promissory Note is signed. Once the Borrower has begun to pay back the note, the principal refers to the amount of money still owing to the Lender at any given moment in time.
Currency:
Term Q. What is the Term? A. The Term is the time length of the note. At the end of the term, the Borrower must repay the outstanding balance of the note.
Term of Note is: Q. What is a demand promissory note? A. The balance owing in a demand promissory note does not need to be paid until the Lender demands to be repaid. In other words, the loan is repayable 'on demand'. There is no fixed end date for the repayment of the note. Upon demand, the Borrower is given a certain period of time to repay the outstanding balance of the note.
Number of Days After Demand before Payment:  (e.g. 10)
Payment
Payments are: Q. What are the payment options available? A. There are four options for the method of repayment. Specific periodic amounts - the Borrower will make a certain payment to the Lender on regular intervals. Lump sum payment at the end of the term - the Borrower pays nothing to the Lender until the end of the note term, at which time the Borrower repays the entire note in one payment. Interest only - the Borrower makes regular payments to the Lender that are put toward paying off the interest on the principal amount only, with no portion of the payment going towards the principal amount itself. The principal is paid at the end of the Term of the note. Interest and principal - the Borrower makes regular payments to the Lender that are put toward paying off both the principal amount and the interest as it is compounded. At the end of the term of the Note, there would be no outstanding balance to be paid.
(Specific Periodic Amount can be a specific monthly, weekly or yearly amount)
First payment to happen:
Payment to start on:

Borrower can pay Outstanding Principal without Penalty: Q. Should the Borrower be able to pay the Outstanding Principal without penalty? A. Granting this option enables the Borrower to pay the outstanding balance at any time without having to pay an additional sum as a penalty. If the Lender is making this loan as an investment, the Lender may not want to allow prepayment without a penalty as the lender would incur expenses and possible lost income in reinvesting this amount.
Interest Q. What is interest? A. Interest is an amount charged to a Borrower for the use of the Lender's money. It is usually expressed as a percentage of the amount borrowed and is calculated at a specified interval over the course of the term of the Promissory Note. The interest rate is the annual interest rate.
Interest Charged? Yes No Q. Do I have to charge the Borrower interest? A. No, the Lender can choose whether or not to charge interest. If the Lender decides to charge interest, they can pick how much interest to charge. However, there may be tax consequences to the Lender or Borrower if interest is charged but it is not a reasonable rate.
Security
This Note is to be secured by security/collateral: Q. Should the Lender require the Borrower to provide security/collateral for the note? A. If you do not take collateral, and the Borrower defaults on the note, you will have to take the Borrower to court in order to recover your money and your judgement can only be enforced against certain assets of the Borrower. However, if you take collateral for the note, then you may be entitled to seize and sell the collateral if the Borrower fails to repay the note.
(in case the Borrower is unable to repay the loan you can go after the security/collateral to be repaid)
Additional Clauses
How Many Additional Clauses do you want to create?
First Additional Clause:

Second Additional Clause:

Third Additional Clause:

Fourth Additional Clause:

Miscellaneous
Specified Address for Payment?
Include Severability Clause?
A severability clause is not necessary in most circumstances. It allows a court to remove a clause that would otherwise make the note unenforceable. You should consider using this clause where your promissory note is more complicated (such as having secured collateral or several additional clauses).
Signing Details
Date Agreement to be Signed: Q. I do not know when the Promissory Note will be signed. Can I fill in the date later? A. Yes, by selecting 'Unsure' as the date the agreement will be signed, a blank line will be inserted into the contract so that you can add the correct date after printing the document.
Lender signature required: Yes No
County where Borrower is signing:
County where Lender is signing: