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A promissory note is a written, signed promise to repay a loan — turning an informal agreement between family, friends, or business partners into a document with clear, enforceable terms.
This generator creates a complete promissory note covering the loan amount, interest rate, and repayment terms, either as a lump sum or in installments.
How it works
Enter the lender and borrower's names and addresses, the principal loan amount and interest rate, and choose lump-sum or installment repayment. The tool calculates the total repayment amount for installment loans and assembles a complete note as a downloadable PDF.
- Enter the lender and borrower names and addresses.
- Enter the principal amount and interest rate.
- Choose lump-sum or installment repayment and fill in the terms.
- Generate the note and download a signature-ready PDF.
Examples
A personal loan between family members
A $5,000 interest-free loan repaid as a lump sum on a specific due date, documented to avoid confusion later.
An installment loan
A $6,000 loan repaid in 12 monthly installments of $500 each, with the total repayment amount calculated automatically.
Who should use it
- Documenting a personal loan between family members or friends.
- Formalizing a small business loan between partners or investors.
Industry applications
- Personal lending and family loans
- Small business financing
Advantages
- Supports both lump-sum and installment repayment structures.
- Automatically calculates the total repayment amount for installment loans.
Limitations
- A general template — doesn't address complex scenarios like collateral or co-signers.
Common mistakes to avoid
- Not documenting an informal loan between family or friends in writing, which can lead to disputes about the terms later.
- Setting an unrealistic repayment schedule the borrower is unlikely to be able to meet.
Best practices
- Even for loans between close family or friends, put the terms in writing — it protects the relationship by removing ambiguity about what was agreed.
Tips
- Check your state's usury laws (maximum legal interest rate) before setting an interest rate, especially for larger loans.