VIEWS: 4,415 PAGES: 4 CATEGORY: Financing With Debt POSTED ON: 1/4/2010
This Promissory Note is a contract between two parties where one party agrees to repay the other for a loan. This agreement requires installment payments on interest only and requires one final lump payment of the principal at the end of the term. Additionally, this agreement is unsecured, which means that the borrower does not provide the lender with a security interest in any property as collateral for repayment. This agreement can be used by individuals or small businesses that want to provide a lender with an unsecured promissory note for the repayment of an interest only loan with a balloon payment.
This Promissory Note is a contract between two parties where one party agrees to repay the other for a loan. This agreement requires installment payments on interest only and requires one final lump payment of the principal at the end of the term. Additionally, this agreement is unsecured, which means that the borrower does not provide the lender with a security interest in any property as collateral for repayment. This agreement can be used by individuals or small businesses that want to provide a lender with an unsecured promissory note for the repayment of an interest only loan with a balloon payment. UNSECURED PROMISSORY NOTE—INTEREST-ONLY WITH A BALLOON FINAL PAYMENT AMOUNT: $_______________ DATE: ________________ INTEREST RATE: _________ DUE: _________________ [Instruction: Insert applicable term information] FOR VALUE RECEIVED, the undersigned, ______________, (the “Borrower”) hereby promises to pay to the order of _____________________ (the “Lender”) at _____________________________ [address] the principal sum of ________________ dollars ($___________), payable on demand, with interest thereon, at the rate of __________ percent (_____%) annually. [Instruction and Comment: Insert interest rate. Parties may customize to different computation period, for example, monthly interest rate. Further, if the interest rate is to be variable, remove the word “fixed” and insert variable, and state initial percentage rate and attach rate change schedule]. PAYMENT SHALL BE MADE on the interest to Lender in equal installments of _______ dollars ($____) [Instruction: Insert amount to be paid] on _____________ [Instruction: Insert payment due date] and shall be delivered to Lender at _____ [Instruction: Insert Lender address]. Lender may, by written notice to Borrower, direct payment be sent to any other entity and/or any other alternative address. A lump payment in the amount of the principal amount of this Note plus any remaining interest and/or any additional charges, including but not limited to late charges or insufficient funds charges, shall be made on __________ [Instruction: Insert date of final payment] at Lender’s address. If payments are not received by the date due, a late charge of ________ dollars ($_____) [Instruction: Insert written dollar amount of late charge to be charged followed by numerical amount in parentheses], in addition to the monthly installment payment, will immediately become due and payable. In the event that any installment payment is returned for insufficient funds (“NSF”) or if Borrower stops payment thereon, Borrower will pay ________ dollars ($_____) [Instruction and Comment: Insert numerical dollar amount to be charged in event of returned check; Amount should be reasonable and Lender may want to have such dollar amount be reasonably related to the amount to be charged by Lender’s bank for such checks] to Lender for each such check, plus late fees as described herein, until Lender has received payment in full. NO COURSE OF DEALING between Borrower and Lender or any delay on the part of the Lender in exercising any rights hereunder shall operate as a waiver of any rights of the Lender. All of the covenants, stipulations, promises, and agreements contained in this Promissory Note made by or on behalf of the Borrower shall bind the Borrower’s heirs, executors, administrators, successors, and assigns, whether or not so expressed BORROWER MAY, at any time, without notice, bonus, or penalty, prepay or cause to be prepaid the whole or any part of the principal amount remaining unpaid hereunder. Any payments made in excess of any interest-only payment due shall be applied first to any late charges then due and owing, then to any NSF charges then due and owing, and then to any interest then due and owing; the remainder of any such excess payment shall then be applied to the principal. © Docstoc®, Inc. 2013 — All Rights Reserved THIS PROMISSORY NOTE shall be governed by the laws of the State of ________________, which laws shall be applicable to the interpretation, construction, and enforcement hereof. [Option: At the parties’ option, the Agreement can be made assignable using the following language. If only one party is to be permitted to assign the rights and obligations under this Note, it can be modified to state which party is permitted to assign] Borrower covenants and agrees not to assign any of the obligations under this Note, except by express, written consent of Lender. Borrower shall, however, be permitted to assign its rights to receive money under this Note without the consent of Lender. An assignment without the prior written consent of Lender shall be absolutely null and void and shall, at Lender’s option, terminate this Note. In the event of same, at Lender’s option in its sole discretion, all principal and interest due under this Note may become immediately due and payable in full. Lender shall have the right to assign its rights and obligations under this Note without any consent by Borrower. IN THE EVENT OF (1) payment of interest or any other amounts secured by this Promissory Note, (2) bankruptcy or insolvency of Borrower, (3) filing of a petition in bankruptcy against Borrower, or (4) the making of a proposal in bankruptcy by Borrower, the whole of the monies (or any part thereof) secured by this Promissory Note remaining unpaid shall, at the option of the Lender, forthwith become due and payable and all the powers in and by the Promissory Note, or by law conferred in case of default, shall become exercisable. ANY CHANGE TO THIS PROMISSORY NOTE, other than a change in Lender’s address, shall be in a writing signed by both parties. DATED this _____ day of ____________________, _______. Witness: Borrower or if Borrower is a Company (COMPANY) Per: Name: Title: I have authority to bind the Company. [Comment: Lender should consult a tax professional and attorney licensed and experienced in tax law if the loan is to be payable at 0% interest, or if any portion of the loan is to be forgiven, as these may implicate estate tax, among other tax issues] © Docstoc®, Inc. 2013 — All Rights Reserved
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