Promissory Note requirements in Delaware
- Must be in writing and signed by the borrower.
- Include the principal amount, interest rate (if any), repayment schedule, and due date.
- Identify the lender and borrower clearly with names and addresses.
- State the consequences of default (e.g., late fees, acceleration).
- For real estate-secured notes, consider notarization; for other notes, notarization is optional but recommended.
- Delaware does not require witnesses for a promissory note.
The process in Delaware
- Download a Delaware promissory note template or create your own.
- Fill in the loan amount, interest rate, and repayment terms. Be specific.
- Include both parties' full legal names and contact info.
- Add a clause about what happens if the borrower misses payments.
- Have both parties sign and date the note. For extra proof, sign in front of a notary public.
- Keep the original note and give a copy to the borrower.
Get a free Delaware promissory note template now and secure your loan today.
Create your promissory noteBudgeting for a Promissory Note
You can create a promissory note for free using a template. If you use an attorney or notary, fees vary—notarization typically costs $5 to $15 in Delaware. There are no state filing fees for a standard promissory note.
Delaware Promissory Note: Before You Begin
A promissory note is a legally binding promise to repay a loan. Before you draft one, gather the essentials and understand Delaware's specific rules.
- Confirm the loan amount, interest rate (if any), repayment schedule, and maturity date – all terms must be clear and agreed upon by both parties.
- Identify the borrower and lender by full legal name and current addresses; include a Delaware address if either party resides there.
- Decide on secured or unsecured: if secured by collateral (e.g., a car or house), you must describe the collateral and record a UCC financing statement with the Delaware Secretary of State to perfect your security interest.
- Check whether your note should be notarized or witnessed. Delaware does not require notarization for a promissory note to be valid, but a witness or notary can help prove authenticity in court, especially for real estate-secured loans.
- Determine if your loan is subject to Delaware's usury laws (which cap interest rates) – for most personal loans, the legal maximum is 5% over the Federal Reserve discount rate, but there are exceptions; keep your rate within legal limits.
- Have your Social Security numbers and/or tax IDs, loan amount, payment method, and a plan for late fees or default in writing before you fill out the template.
FAQs
Does a Delaware promissory note need to be notarized?
No, notarization is not required for a promissory note in Delaware, but it's recommended to add credibility and make it easier to enforce. For notes secured by real estate, notarization may be needed for recording.
Can I write a promissory note by hand in Delaware?
Yes, a handwritten promissory note is valid as long as it contains all essential terms and is signed by the borrower. It's safer to use a typed template to avoid ambiguity.
What happens if the borrower defaults in Delaware?
You can sue the borrower in small claims or superior court, depending on the amount. If the note is secured by property, you may foreclose. A notarized note helps prove authenticity.
Is a promissory note the same as a loan agreement?
No. A promissory note is a promise to repay, often simple. A loan agreement is broader and includes additional terms like collateral, warranties, and detailed obligations. Many loans use both.