This article was co-authored by Clinton M. Sandvick, JD, PhD. Clinton M. Sandvick worked as a civil litigator in California for over 7 years. He received his JD from the University of Wisconsin-Madison in 1998 and his PhD in American History from the University of Oregon in 2013.
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When you loan money to someone, it is important to create a legal document that lays out how the loaned money will be repaid. This is the case even if you are loaning money to a friend, colleague, or relative. This legal document, called a promissory note, is a written instrument that contains a promise by one party to pay another party a definite sum of money either on demand or at a specified future date. [1] X Research source Your promissory note should contain various important provisions including the amount due, the interest rate, and the maturity date. [2] X Research source Follow the steps in this article to create a clear, concise, and legally enforceable promissory note.