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Help Guide

A note payable is used to quickly document the terms of a transaction, creating a debt obligation on the part of the borrower.

Party Information

You will start by entering in the relevant party information. The borrower is the party promising to pay back the lender in the note payable (also called a promissory note).

Transaction Details

Be as specific as possible in describing what the borrower is receiving from the lender, whether it is a mortgage loan, goods, services, etc. You will then describe how the lender expects to be repaid. You will also have the option to include miscellaneous terms and conditions later in the form builder should you need to further customize your agreement.

Collateral

Then you will describe whether the lender is requiring any collateral to ensure repayment. In a mortgage agreement, for example, the collateral is the house itself. If the borrower defaults on repayment, then the lender gets to keep or sell the collateral.

Witnessing Your Document

Lastly, you will be asked about including a notary and witness. It is always recommended to include a notary to help prove the validity of the document should you ever need to. For the same reason, including a witness is helpful. If possible, it is a good idea to include both.

Executing Your Note Payable

After you are done filling out the form, simply have the borrower, lender, and any notary and witness available sign the document in each other's presence. Again, although a notary and witness are not required in most jurisdictions, it is always a good idea to include them. When the document has been signed and witnessed you are done! Make sure the borrower and lender each get a copy.

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Checklist

Step 1: Gather Information

As you complete your note payable, you will need to provide certain relevant information. This includes the names and addresses of all borrowers and lenders, transaction details, and repayment terms.

Step 2: Answer Key Questions

Use the information you collected to complete the note payable. We make this easy by guiding you each step of the way and helping you to customize your document to match your specific needs. The questions and information we present to you dynamically change depending on your answers and the state selected.

Step 3: Review and Sign

It is always important to read your document thoroughly to ensure it matches your needs and is free of errors and omissions. After completing the questionnaire, you can make textual changes to your document by downloading it in Microsoft Word. If no changes are needed, you can simply download the PDF version and sign. These downloads are available by navigating to the Documents section of your account dashboard.

Although a notary and witness are not required in most jurisdictions, it is always a good idea to include them. When signing the document, be sure to follow any additional instructions related to signing and witnessing the document. Any such instructions will either be located next to the signature line or in the instructions attached at the end of the document.

When using a notary or other witness, you must wait to sign the document until they are present.

Step 4: Distribute and Store Copies

At a minimum, all parties that sign the document should receive a copy once it is fully executed (everyone has signed). Other interested parties may need or want copies as well. Be sure to store your copy in a safe location. It is a good idea to keep both a physical and electronic copy.

Step 5: Periodically Review

It is easy to forget the ins and outs of your note payable. Periodically reviewing it will help you stay familiar with any responsibilities or requirements so that you can determine when it needs changes or additions.

Step 6: Complete Related Documents

Completing documents such as a loan agreement and sales contract may help offer additional protection. For example, a loan agreement provides additional details and protections regarding repayment. A sales contract, if applicable, will help solidify terms regarding delivery, shipment instructions, warranties, and important deadlines.