Formswift: Create a Texas promissory note with our easy-to-use template
Get started with our Texas promissory note template and write loan agreements in minutes. Be it a secured or unsecured promissory note, this legal document will clearly stipulate the amount of money being lent and your rights according to Texas law.
What is a Texas promissory note used for?
A Texas promissory note can be used for a diverse range of lending situations, from personal loans and business loans to real estate transactions. It clearly states the amount of interest, accrued interest, loan amount, and repayment schedule, giving clarity and protection to both parties.
Common types of a Texas promissory note
There are three common types of promissory notes in the state of Texas:
Simple fixed-term promissory note
This type of note establishes a straightforward repayment plan, including the principal amount borrowed, interest rate (if any), and fixed installments over a specific period.
Balloon promissory note
The borrower makes regular payments for a set period, then a larger "balloon" payment at the maturity date.
Secured promissory note
In this case, the note's backed by collateral such as real estate or personal property. This provides extra security for the lender.
What do I need to write a Texas promissory note?
You'll need the following information to create a valid Texas promissory note:
- Parties involved: Clearly state both the borrower and the lender’s names and contact details.
- Loan amount: Specify the exact amount of money being borrowed.
- Repayment terms: Outline the repayment schedule and due date.
- Interest rate: If applicable, specify the rate of interest and any additional information (like late fees).
- Nonpayment: What happens if the borrower can’t pay off the principal amount?
- Collateral: If the loan is secured, describe the collateral being used to secure the loan.
- Governing law: Indicate that the agreement is subject to the laws of the state of Texas.
- Signatures: Both parties must sign the finalized document.
Frequently asked questions
Yes, you can use a Texas promissory note for both personal and business loans. It provides a clear legal framework for loan agreements in various contexts.
Absolutely. Our Texas promissory note template is fully customizable, so you can tailor it to your specific loan agreement requirements.
In the event of default, the lender can pursue legal remedies to recover the outstanding amount. This may include litigation or collection efforts.
Yes, you can include an interest rate in your Texas promissory note. However, you must comply with Texas’s usury laws, which cap the maximum interest rate you can charge at 6%.
Consulting with a lawyer can ensure that your Texas promissory note meets all legal requirements and addresses your specific needs.
Disclaimer: This information is intended for general informational purposes only. It is meant to help you understand the legal framework used for this form. This is not intended to be legal advice and should not be a substitute for professional legal advice. Consult a licensed attorney for legal advice or representation.
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