A promissory note is a formal, legally-binding agreement between two parties: the borrower and lender. The note describes how much money the parties exchanged, the due date of the loan payment, how the borrower will pay interest, and whether the borrower will use collateral assets to secure the loan, should they become unable to repay the principal.
Debt collection for a New Hampshire promissory note is only valid for six years, according to New Hampshire legal code RSA 382-A: 3-118. That statute of limitations means that if the lender will have six years to collect their debt before the note expires.
In New Hampshire, there are two types of promissory notes.
New Hampshire Secured Promissory Note
A New Hampshire promissory note can be secured; the borrower must offer up an asset equivalent to the amount of the debt owed should they default on the payment. The borrower can use assets like a vehicle or property as collateral.
A promissory note template New Hampshire will include the following information:
- Day, month, and year of the deal
- Borrower’s full name
- Borrower’s address
- Lender’s full name
- Lender’s address
- Principal amount (value of the loan)
- Interest rate
- Collateral assets
- Signatures of borrower, lender, and notary public
You can easily find a free New Hampshire promissory note form online and print it. You and the other party will then negotiate the terms of the loan and sign the form. Once signed, the promissory note is a legal document that a court will recognize.
New Hampshire Unsecured Promissory Note
An unsecured New Hampshire promissory note needs the same information as a secured promissory note, except for the collateral asset stipulation. The borrower won’t have to relinquish an asset equal to the amount owed should they default on the loan.
The lack of collateral means an unsecured New Hampshire promissory note makes the loan riskier for the lender. That’s why these types of notes are common between friends, family members, and otherwise people who know each other well, as social standing between parties replaces the need for collateral.
You can find a promissory note New Hampshire form online if you need to sign an unsecured note. Lenders should have built trust with the borrower before signing one of these notes, though, as promissory notes are sometimes a front for scams.