There must be a rule between the borrower and moneylender to secure the money and protect both parties. A promissory note form is another term that you should use to bind both parties legally. Usually, these terms are more to protect the lender while the borrower has agreed with all of the terms and conditions offered. If the borrower breached the agreement, legal action is allowed to take.
Our free blank promissory note template is the best template that you can use for free. You can use this template whenever you want when you are planning to lend some money to your family, friends, close colleagues and so on. You can use this free printable promissory note PDF or download another format if you want to edit it.
What Is The Promissory Note Used For?
The promissory note is a document that outlines details about lending and borrowing money with certain terms of rules and repayment structure. If there is interest, the borrower is required to pay this debt in certain types.
Note that the promissory note is divided into two parts which are secured and unsecured. The secured promissory note is a document that guarantees the borrower to pay the money with the assets as the guarantee. Therefore, when the borrower fails to pay the debt, the assets will be taken over by the lender. Meanwhile, the unsecured note is a document that doesn’t include any asset as the collateral when the note is unpaid. It is less formal and is usually used among family members and friends. However, the promissory note form is also used by banks to the customers who maintain good records.
Types Of Promissory Note
- The secured promissory note – This includes the assets that will secure the amount of the moneylender by the lender. This is usually in the form of a home or a vehicle. When the borrower fails to pay back the debt, the lender has the right to turn over the assets mentioned in the agreement.
- Unsecured promissory note – When the unsecured promissory note is signed, the lender is not allowed to take over the assets. Then, what happens if the borrower fails to pay the debt? This means the lender has no right to take over the assets but it is legal for the lender to file a claim in the court. This will take a long process but usually, with enough proof, the lender might win the case. This is why when writing a promissory agreement, everything should be stated clearly and cannot use sentences that result in ambiguity.
How To Write A Proper Promissory Note?
Because promissory note doesn’t have complex terms, then you can download our template for free on this page. Download ur promissory note from here with various formats and designs. We try to make the template as general as possible, so you don’t have to make major editing.
But if your agreement is too complex, the promissory note is not your thing. You can download the agreement templates that you can find on our website. Just search your desired templates and then find the best one for you.