A Promissory Note is the simplest way of acknowledging a debt. The Promissory Note is a legally binding contract. The debt is unsecured.
The Note consists of a written, dated and signed unconditional promise by the maker to pay a definite sum of money to a payee on demand, or at a specified future date. The note can provide for interest to be payable on the debt. A promissory note is only signed by the promisor (maker), and not by the payee (the lender).
A promissory note is freely transferable (hence the promise to pay is unconditional).
In the case of promissory notes, the law presumes (contrary to the usual rules of contract) that consideration is provided. Thus it is not necessary to execute a promissory note as a deed.
The Promissory Notes folder contains several different versions of the Promissory Note, tailored for companies and individuals. The Promissory Note (Basic) is best suited for loans between individuals of small amounts of money where no interest is payable. The Promissory Note – Company (Basic) is the same, but for use by a company. Other versions have provision for interest and for payment by instalments.
Promissory Notes are part of the Corporate folder. Access all Corporate documents for £35+VAT.