Delaware Promissory Note

What Is a Delaware Promissory Note?

A Delaware promissory note may be a legally binding document between a borrower and a lender when it is properly executed under Delaware law. The purpose is to outline a contractual agreement on how a loan will be repaid. Delaware promissory notes may be secured or unsecured.

• When a promissory note is secured, the borrower promises to give the lender something of value if the borrower does not make payments as agreed. The item is known as collateral. When collateral is used, the promissory note may be treated as a secured transaction under Title 6, Article 9 of Delaware law.
• Without a promise of collateral, the note is considered unsecured. If the borrower doesn’t pay, the lender cannot take any property belonging to the borrower. Instead, they will need to file a lawsuit if they want to get repaid.

DOWNLOAD this Delaware promissory note form which records a promise to repay money loaned from one Delaware resident to another.  The note form allows the makers to determine how much interest will be charged and whether or not the loan will be secured.  The makers may also choose how they want the loan to be repaid and how much time the borrower has to repay.

A Delaware promissory note defines the terms of an arrangement where a lender loans a sum of money to a borrower with the latter promising to pay back the former by a certain date. The note establishes the amount of the loan, the amount of interest charged, the frequency of payments, any late fees that apply, and collateral (if any).

Any individual or company can issue a promissory note, but typically they are used by lenders other than financial institutions loaning smaller sums of money. Unlike a loan agreement, a promissory note does not include default provisions. These provisions detail what will happen if the borrower fails to pay back the lender, which may include a lawsuit, home foreclosure, asset seizure, vehicle repossession, etc.

A promissory note is a written and enforceable agreement in which a borrower promises to pay a lender a sum of money on demand, or within a specified period of time. The note records information about how much was lent (the principal amount), interest rates, when the payment is due (maturity date), when and where it was issued, and signatures.

A promissory note is also referred to as a:

• Debt Note
• Demand Note
• Commercial Paper
• Notes Payable