Promissory Note

A Promissory Note is a financial instrument that contains a written promise by one party (the issuer or maker) to pay a definite sum of money to another party (the payee or holder) either on demand or at a specified future date. It is a legally binding document that outlines the terms of the loan, including the principal amount, interest rate, repayment schedule, and the date of maturity. They serve as evidence of debt and can be secured (backed by collateral) or unsecured. Loan management software automates customized creation and distribution of promissory notes to borrowers.