The Texas unsecured promissory note binds a lender and borrower into an agreement requiring the borrower to make scheduled and complete payments to the lender until the borrowed balance is paid for in full. This note is not secured by an object, meaning the lender can potentially lose the loaned balance if the borrower enters into default and cannot recover. Screening potential borrowers is crucial for preventing this situation.
How to Write
Step 1 – Enter the current date, the names and addresses of both parties, the full balance of the note, and the note’s interest rate.
Step 2 – Select the payment method for the agreement. If you select a method that uses installments, put a checkmark next to either weekly or monthly payments and enter the date that the first payment will be due.
Step 3 – Heading to the second (2) section, enter the date the the entire balance must be paid by.
Step 4 – For the third (3) section, enter the interest rate that will enter into effect if the borrower is late by more than fifteen days on a payment or if he or she enters into default on the balance. Ensure you have selected a legal interest rate in the state of Texas by checking TX FIN § 303.009.
Step 5 – For the sixth (6) and seventh (7) sections, begin by entering all required info on late fees into the two empty text boxes. Then, enter the time span the lender is required to wait after a default has occurred before he or she can issue an acceleration.
Step 6 – Finally, head to the last page of the template and enter the current date and the printed and signed names of the lender, borrower, and the agreement witness. Once all signatures have been properly recorded, the agreement will go into full effect and the borrower will be responsible for making timely payments.