A promissory note is a written agreement promising to pay an agreed upon sum to the holder of the note on a specified date. These legal documents are used in a variety of situations. A promissory note can lay set out the requirements for a payment plan, a lump sum payment, or payment due on demand of the holder. Generally a promissory note is issued in exchange for a product or service, but usually has simpler terms than a loan contract. The more complicated the loan arrangement, the more complex the agreement should be.
Promissory notes are also called notes payable. They are a lot like an IOU, and are often used between family and friends involved in a real estate, personal loan, or personal property transaction...Read More