Promissory Note requirements in Louisiana
- Must be in writing and signed by the borrower.
- Include the exact amount of money loaned (principal).
- State the interest rate, if any. If silent, Louisiana law may not imply interest.
- State repayment terms: due date, installment schedule, or demand.
- Identify the lender and borrower clearly, with names and addresses.
- Consider having it signed before a notary public to make it authentic (not required for validity, but helps with enforcement).
The process in Louisiana
- Get a promissory note template or create your own. Use clear language.
- Fill in the date, lender name, borrower name, and loan amount.
- Write the interest rate and how it's calculated (e.g., simple interest per year).
- Specify repayment: one lump sum, installments, or on demand. Add due dates.
- Add any collateral, late fees, or default terms. Keep them legal.
- Both parties sign. Have a notary witness the signature if you want extra protection.
Download a free promissory note template for Louisiana and fill it out in minutes.
Create your promissory noteBudgeting for a Promissory Note
Filing or recording a promissory note is not required in Louisiana for most private loans. The main cost is notarization, which typically runs $10–$20 per signature. Using an online template is usually free or under $20.
Louisiana Promissory Note: Prep Checklist
Before drafting your promissory note, gather the essentials and review Louisiana-specific rules to ensure enforceability.
- Collect both parties' full legal names, addresses, and Social Security numbers (or Tax ID) for clear identification.
- Specify the principal amount, interest rate (be mindful of usury limits), payment schedule, and maturity date in writing.
- Decide whether the note will be secured or unsecured; for secured loans, list collateral and consider recording a mortgage or security agreement with the parish clerk of court.
- Check your parish's notary requirements—Louisiana often requires a notary and two witnesses for authentic acts, which can strengthen enforceability; otherwise, a private writing may suffice.
- Review the statute of limitations for enforcing promissory notes in Louisiana (typically 10 years for written instruments) and consider adding an attorney's fees clause, but verify enforceability.
- Gather valid identification, loan amount proof (e.g., check or wire receipt), and any prior written agreements to reference in the note.
FAQs
Does a promissory note need to be notarized in Louisiana?
No. A simple written and signed note is valid. But having it notarized makes it an authentic act, which speeds up collection if the borrower defaults.
What is the difference between a promissory note and an IOU?
An IOU just acknowledges that money is owed. A promissory note includes repayment terms and is a stronger legal document. If you lend money, use a promissory note.
Can I use a promissory note for a personal loan between friends?
Yes. It’s a good idea even with friends. A written note prevents misunderstandings and helps in court if repayment fails.
What happens if the borrower doesn't pay?
You can file a lawsuit to collect. With an authentic (notarized) note, you can get a judgment faster. You may also be able to seize collateral if the note says so.