What is a promissory note?

A promissory note is an enforceable legal document that outlines the terms of lending money in the state of North Carolina. It is a contract between the lender and the borrower that states the lender will provide the borrower with a loan in exchange for the borrower’s promise to repay the amount borrowed. The note also indicates the exact repayment amount and the frequency and terms of the payments. A promissory note is typically used for short-term loans, such as those between individuals or businesses. The amount of the loan and the payment plan must be clearly stated in the note, as well as the interest rate and the date of the last payment. The borrower must sign and date the note for it to be legally binding. The note will usually also include language that gives the lender the right to take legal action against the borrower if they fail to pay according to the terms of the promissory note. In North Carolina, the lender’s right to take legal action is limited to the amount of the loan, plus any interest, and cannot include additional punitive damages. In short, a promissory note is an agreement between two parties that outlines the loan amount, repayment schedule, and the terms of repayment. It serves as a legally binding document that protects the rights of both the lender and the borrower and ensures that the loan is repaid in accordance with state law.

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What is a promissory note?

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