Unsecured Promissory Note Template, Free Download 2026

This Unsecured Promissory Note (the "Note") is made as of [____________] (the "Effective Date") by [____________] (the "Maker"), an individual residing at [____________], in favor of [____________] (the "Payee"), an individual residing at [____________]. This Note is unsecured and is not supported by any collateral, mortgage, deed of trust, or other security instrument. Payee is relying solely on Maker's personal creditworthiness and promise to pay in extending the loan evidenced hereby.

WHEREAS, Payee has agreed to loan to Maker the principal sum set forth herein; and WHEREAS, Maker desires to evidence such indebtedness by this Note; NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Maker promises to pay to the order of Payee the amounts and at the times specified in this Note. This Note is not secured by any collateral and Maker's obligations hereunder are general unsecured obligations.

Maker promises to pay to Payee the principal sum of [$__________] (the "Principal Amount") in lawful money of the United States, together with interest thereon as specified in Article III. The Principal Amount represents the total loan proceeds disbursed by Payee to Maker on or about the Effective Date. Maker acknowledges receipt of the full Principal Amount and agrees that no further advances are contemplated under this Note.

All payments under this Note shall be made to Payee at the address set forth above, or to such other address or account as Payee may designate by written notice to Maker. Payments shall be made by check, electronic funds transfer, or such other method as is mutually agreed upon by the parties. All payments shall be applied first to accrued Late Charges, then to accrued and unpaid interest, and then to principal, unless otherwise directed by Payee in writing.

The unpaid Principal Amount shall bear simple interest at a rate of [____]% per annum (the "Interest Rate"), calculated on the basis of a 365-day year and actual days elapsed, commencing on the Effective Date. The Interest Rate shall not at any time exceed the maximum rate of interest permitted under the usury laws of the State of [____________], and if any payment of interest would result in interest being charged in excess of such maximum rate, such payment shall automatically be reduced to the amount that results in interest at the maximum lawful rate.

In the event of any usury savings clause adjustment, any excess interest shall be credited against the outstanding Principal Amount, and if the Principal Amount has been paid in full, refunded to Maker. Maker and Payee intend to comply at all times with applicable usury laws. To the extent any interest or other charge under this Note is determined by a court of competent jurisdiction to be usurious, it shall be deemed void ab initio as to the excess and shall not affect the validity of the remaining provisions of this Note.

Maker shall repay the Principal Amount and accrued interest in [____] equal [monthly/quarterly] installments of [$__________] each, with the first installment due on [____________] and subsequent installments due on the [____] day of each successive [month/quarter]. All outstanding principal, accrued interest, and any other sums due under this Note shall be due and payable in full on [____________] (the "Maturity Date"). Each installment shall consist of principal and interest amortized over the term of this Note.

If any installment payment is not received by Payee within [____] calendar days following the due date thereof, Maker shall pay a late fee equal to [____]% of the overdue amount or [$__________], whichever is greater (the "Late Charge"). The Late Charge shall be immediately due and payable and shall constitute liquidated damages representing a reasonable estimate of Payee's administrative costs resulting from late payment. Collection of the Late Charge shall not waive Payee's right to declare an Event of Default.

Maker shall have the right to prepay this Note in whole or in part at any time, and from time to time, without penalty or premium of any kind, upon written notice to Payee at least [____] Business Days prior to the intended prepayment date. Partial prepayments shall be applied to the outstanding Principal Amount and shall reduce future installment amounts proportionally, unless Payee and Maker agree in writing that partial prepayments shall instead reduce the number of remaining installments while maintaining the existing installment amount.

Upon prepayment in full, Payee shall mark this Note "Paid in Full" and return the original executed Note to Maker within [____] Business Days. No partial prepayment shall excuse Maker from paying any installment on the date it becomes due until the entire Principal Amount and all accrued interest have been paid in full. Accrued interest on the prepaid amount shall be calculated through the date of actual receipt of the prepayment by Payee.

Each of the following shall constitute an "Event of Default" hereunder: (a) Maker's failure to make any payment of principal or interest within [____] days after the date when due; (b) any representation or warranty made by Maker in connection with this Note proves to have been false or misleading in any material respect when made; (c) the filing of a petition by or against Maker under the United States Bankruptcy Code (Title 11) or any state insolvency law; (d) Maker's admission in writing of inability to pay debts as they become due; (e) the entry of a judgment or judgments against Maker aggregating in excess of [$__________] that remain undischarged or unstayed for [____] consecutive days.

Upon the occurrence and during the continuance of any Event of Default, the outstanding Principal Amount and all accrued interest shall bear interest at the Default Rate of [____]% per annum, or the maximum rate permitted by applicable law, whichever is less. Payee may, but shall not be required to, provide Maker with written notice specifying the Event of Default and affording Maker a cure period of [____] days from receipt of such notice; provided, however, that no cure period shall be required for Events of Default described in clauses (c) and (d) above, which shall be immediate and non-curable.

Upon the occurrence of any Event of Default, Payee may, at Payee's sole and absolute discretion, declare the entire unpaid Principal Amount, together with all accrued interest, Late Charges, collection costs, and all other amounts due under this Note, to be immediately due and payable without further notice or demand, except as may be required by applicable law (the "Acceleration"). Upon any Event of Default under Section 6.1(c), the Acceleration shall occur automatically without any election or action by Payee.

Following Acceleration, Payee may pursue all available legal and equitable remedies to collect the amounts due hereunder, including but not limited to commencing a civil action for damages, obtaining a prejudgment attachment or garnishment to the extent available under applicable law, and seeking any other relief to which Payee may be entitled. Maker acknowledges that because this Note is unsecured, Payee's remedies are limited to personal recourse against Maker.

Maker hereby waives presentment for payment, demand, notice of dishonor, protest, and notice of protest of this Note, and all other notices in connection with the delivery, acceptance, performance, default, or enforcement hereof, to the fullest extent permitted by the Uniform Commercial Code of the State of [____________] and other applicable law. Maker further waives all defenses based on suretyship or impairment of collateral, acknowledging that this Note is unsecured.

No extension of time for payment, forbearance, indulgence, or modification of the terms of this Note granted by Payee to Maker shall operate as a waiver of Payee's rights under this Note or at law. Maker agrees that Payee's acceptance of partial payments or payments marked "paid in full" or with similar notations shall not constitute an accord and satisfaction and shall not waive or impair Payee's right to collect the full amount due hereunder.

This Note shall be governed by, construed, and enforced in accordance with the internal laws of the State of [____________], without regard to principles of conflict of laws. Any action, suit, or proceeding arising out of or relating to this Note shall be brought exclusively in the courts of general jurisdiction of [____________] County, State of [____________], or in the United States District Court for the [____________] District of [____________], and each party irrevocably submits to the jurisdiction of such courts.

In the event of any action, suit, or proceeding to enforce this Note, the prevailing party shall be entitled to recover reasonable attorneys' fees and costs from the non-prevailing party, including fees incurred in any appeal or enforcement of judgment. This Note may not be amended, modified, or waived except by a written instrument executed by both Maker and Payee. This Note shall be binding upon the parties and their respective heirs, executors, administrators, successors, and permitted assigns.