What is a promissory note in New York?

A promissory note is a document that governs a loan between two parties. In New York, you use it when you loan money to another person, whether in your business or personal life. This document will state the loan amount, the parties involved, the agreement terms, and how the person borrowing the money will repay it.

Why use a secured promissory note in New York?

A secured promissory document is the better option, ensuring you don’t have much to lose when lending someone money. With a secured note, the other party offers collateral of equal value, which means if they fail to repay the Loan, you can accept the collateral as payment. In this case, you protect your interests more than if you have no collateral.

How long is a promissory note valid in New York?

New York defines promissory notes as contracts, so the six-year statute of limitation applies. Once six years have passed, you’ll need to draw up a new document. However, you can also add terms to your Note which define the period it’ll be active for if you want repayment in a shorter period.

How to enforce a promissory note in New York?

A New York promissory note form is legally binding once both parties sign it, meaning if one party violates any of the terms, you can take specific actions. You can enforce the agreement by giving the other party notice, and if they don’t complete or cure the violation, then you can file an action with a court of law or as a complaint for expedited judgment.

Promissory Note Template New York

Prepared for:

[Borrower.FirstName][Borrower.LastName]

[Borrower.Company]

Created by:

[Lender.FirstName][Lender.LastName]

[Lender.Company]

1. Agreement

Borrower:[Borrower.FirstName][Borrower.LastName] of [Borrower.StreetAddress][Borrower.City][Borrower.State][Borrower.PostalCode]

Lender:[Lender.FirstName][Lender.LastName] of [Lender.StreetAddress][Lender.City][Lender.State][Lender.PostalCode]

Principal Amount: $(Loan.Amount)

Date of Loan: (Loan.Date)

This Promissory Note states the terms of the Loan the Lender gave the Borrower on (Loan.Date), where both parties signing this Note agree to uphold, enforce, and abide by the terms of this legally binding document entirely.

The Lender agrees to loan the balance above to the Borrower, who agrees to repay this amount, plus the monthly interest in the amount of (Interest.Percentage)% from the date this Loan was taken.

2. Security

This agreement operates on the principle of:

Unsecure – There is NO SECURITY provided by the Borrower to the Lender on this Note.

Secure – There is property described as (Security.Description) (“Security”), which immediately transfers to the possession and ownership of the Lender pursuant to Section six (6) of this Note. Until the due date of the entire Loan, the Borrower may not sell or transfer the Security without the consent of the Lender. Should the Borrower breach this term, the Lender has the right to declare all sums due under this Note immediately due and payable.

Should the market value of the Security not meet or exceed the Loan, then the Borrower remains liable for the balance due while accruing interest at a rate of 16%. Should the Lender accept the Security as a total repayment of the Loan without further obligations or liabilities, the Borrower is not required to pay back the balance of the Loan.

3. Repayment

The Borrower agrees to repay the Loan and interest accrued in installments, as stated below.

Payment Due Date	Payment Amount
(MM/DD/YYYY)	$(Payment.Amount1)
(MM/DD/YYYY)	$(Payment.Amount2)
(MM/DD/YYYY)	$(Payment.Amount3)

3.1 Late Fees

Should the Lender receive the installment more than (Days) days after the due date, they have the right to charge a late fee of $(Late.Fee), to be paid along with the late installment and its default interest.

The Borrower can prepay part of or the entire principal amount of this Note, together with accrued and unpaid interest, at any time. There will be no penalty or premium charges on such a prepayment.

The entire Loan, along with all accrued interest and unpaid late fees, is due no later than (MM/DD/YYYY).

4. In the Event of a Default

Should the Borrower default under this Note or any provision of it, and they do not cure the default within the allotted time of (Days) days, the Lender can declare all outstanding sums of this Note to be immediately payable.

The Borrower can be in default should any of the following, but not limited to, occur:

Failure to complete the installments as outlined in Section three (3).
Death, incapacitation, or bankruptcy of the Borrower.
If Borrower violates the terms of this agreement.

The Borrower agrees to be solely responsible for all expenses the Lender incurs by enforcing the terms of this Note. It includes, without limitation, attorney fees and collection agencies. These costs will be added to the principal amount and due immediately upon demand of the Lender.

Unpaid principal, interest, and late fee amounts more than 15 days late will accrue interest at the maximum rate of 16% per year until the Borrower is no longer in default of this Note.

5. Terms and Conditions

5.1 Waiver

The Borrower and their sureties, guarantors, and endorsers waive notice of dishonor, presentment for payment, protest, and notice of protest.

5.2 Successors and Assigns

This Note inures to the benefit of the Borrower and is binding on their respective heirs, administrators, executors, successors, and assigns. The Borrower can only transfer or assign this Note and the duties and rights within it with the prior written consent of the Lender.

5.3 Joint and Several Liability

The Borrowers are jointly and severally liable for this Note if there is more than one Borrower.

5.4 Amendment

Should the Borrower or Lender want to amend this Note, they must do it in writing, with both parties signing the new Note. No verbal or other agreements modify or affect the terms of this Note.

5.5 Severability

Should any part of this Note be declared void by a court of law or become unenforceable, it will become severed from the Note, and the remaining provisions will be in full force and effect.

5.6 Notifications

Any notices or communication regarding this Note should be given in writing and sent via these methods: [Lender.Phone], [Lender.Email], or mailed to [Lender.StreetAddress][Lender.City][Lender.State][Lender.PostalCode].

6. Final Agreement

This Note is legally binding and cannot be transferred without the consent of both parties. This Promissory Note is the sole agreement governing the Loan, as no other statements, promises, or commitments are considered valid and enforceable.

The laws of the state of New York govern this agreement, and all terms are construed following those laws. It is subject to the exclusive jurisdiction of federal and state courts located in (County), New York.

IN WITNESS WHEREOF, both parties have executed this Promissory Note by its duly authorized officer as of the day and year below.

[Lender.Company]

Signature

MM / DD / YYYY

[Lender.FirstName][Lender.LastName]

[Borrower.Company]

Signature

MM / DD / YYYY

[Borrower.FirstName][Borrower.LastName]

[Witness.Company]

Signature

MM / DD / YYYY

[Witness.FirstName][Witness.LastName]

Promissory Note Template New York

1. Agreement

2. Security