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Free Promissory Note

A legal document between the lender and the borrower, where the borrower promises to repay a loan to the lender.

A promissory note is a legal financial instrument, sometimes referred to as a note payable, that contains a written promise by the borrower to pay the lender a determinate sum of money, either at a fixed or determinable future time or on demand.

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Promissory Note FAQs

What else can a promissory note be called?

A promissory note can also be referred to as follows: demand note, IOU “I owe you”, loan agreement, or promise to pay agreement.

What is a promissory note?

A promissory note is a legal document where the borrower promises to repay the loan to the lender under the terms and conditions listed in the note.

What points should the promissory note cover?

You can create a promissory note using our simple template. A promissory note should have the terms as follows:

Governing law: Select the province where the lender resides and the promissory note will be customized for that jurisdiction.
Parties’ Info: Lender and borrower information such as full name and addresses.
Loan amount: How much is the loan.
Collateral: What security will be seized by the lender if the borrower fails to repay the loan. Describe the item in detail to ensure the collateral is not ambiguous. (e.g. list the VIN number if it is a vehicle, or a serial number if it is electronics)
Interest payment: How much interest is being charged to the loan, if applicable
Repayment schedule: How will the loan be paid back, whether in equal payments, a lump sum, or on demand. Payment schedules are flexible and can be made weekly, monthly, quarterly, semi-quarterly, and annually.
Prepayment penalty: List the penalty for repaying the loan early, if applicable.
Late penalty: How much additional interest will be charged if the payment is late, if applicable.

Do you need to notarize a promissory note?

Only the signature of the borrower and the lender are required to have a valid and enforceable promissory note. But if the loan is a substantial amount, it may be prudent to have it notarized since it adds a layer of authenticity if there are any future disputes regarding the loan.