Promissory Note requirements in Michigan
- Must be in writing and signed by the borrower.
- Must state the principal amount, interest rate (if any), and repayment schedule.
- Should identify the lender and borrower clearly.
- For real estate-secured loans, a witness and notary are required to make the note eligible for recording.
- If the note is secured by property, it must be signed by the borrower and acknowledged before a notary public.
- Consider having a witness sign, even if not required, to strengthen enforceability.
The process in Michigan
- Download a Michigan promissory note template or create your own.
- Fill in the loan amount, interest rate, repayment terms, and late fees.
- Include the borrower's and lender's full legal names and addresses.
- Both parties sign the note. For secured loans, get it notarized.
- Make copies for both parties. Store the original in a safe place.
- If securing with real estate, record the note with the county register of deeds.
Get a free Michigan promissory note template and protect your loan today.
Create your promissory noteBudgeting for a Promissory Note
Filing fees for recording a secured promissory note vary by county, typically $30 to $60. Notary fees are usually $5 to $10 per signature. A lawyer can cost $200-$500 if you need help.
Michigan Promissory Note Checklist
Before drafting your Michigan promissory note, gather key details and understand state-specific rules to ensure a valid, enforceable agreement.
- Identify the parties' full legal names and addresses, and the exact loan amount and repayment terms.
- Decide whether the note will be secured or unsecured; if secured, describe the collateral clearly.
- Include the interest rate, payment schedule, late fees, and default terms in clear language.
- In Michigan, notarization is not required for the note itself, but having it witnessed can help prove authenticity.
- Check with your local county register of deeds if you plan to file a mortgage or security interest; filing requirements vary.
- Keep a signed copy for both parties and ensure the note states it is governed by Michigan law.
FAQs
Is a witness required for a promissory note in Michigan?
For a typical unsecured note, no witness is required. But for a note secured by real estate, Michigan law requires a witness and a notary acknowledgment.
Can I use a promissory note for a personal loan from a friend?
Yes, a promissory note works for any loan. It clarifies terms and protects both parties.
What happens if the borrower doesn't pay?
You can sue on the note. If it's secured, you may foreclose. Consult an attorney for specific steps.
Do I need to file a promissory note with the state?
No. Michigan doesn't require filing unsecured notes. Only if you secure it with real estate, record it with the county.