A promissory note due on a specific date is a legal instrument that documents one person’s promise to pay a sum of money to another on a pre-determined date.
- Loaning money that you want returned on a pre-determined date
- Borrowing money that must be returned on a pre-determined date
A promissory note records a financial transaction that involves repayment upon a debt. The promissory note will include all relevant details of a debt, including the date by which the debt must be repaid, any fees or interest that may apply, the parties involved in the transaction, and all other terms and conditions of the loan. Commonly, promissory notes include a condition that the debt must be paid on a particular date. A promissory note due on a specific date documents in writing your intent to repay a loan on a particular date – not before or after. While it may seem odd that a borrower would be prohibited from paying off the loan early, this is a very common term. In general, promissory notes are fully transferable, meaning they can be bought and sold as assets. It is important for lenders to be able to ensure future revenue from promissory notes due on a specific date so that they can manage their investments properly. Promissory notes due on a specific day include a particular date upon which the last payment on the debt must be made. If the writer of the note wants to be able to pay off his or her debt early there must be an express agreement to that effect. Regardless of whether you are the borrower or the person making the loan, promissory notes are an effective way to formalize a repayment agreement between two parties. Many common financial transactions, such as taking out a mortgage, require a promissory note as a matter of law or best practice, so a promissory note is a financial instrument that everyone should be aware of.