Create a clear promissory note for a personal or family loan. Enter who lends and who borrows, the amount, the interest rate and how it will be repaid, and the note and its repayment schedule are written for you. Download a printable PDF or Word file, or the schedule as CSV.
Last updated:
Payment–
Total interest–
Total repaid–
Final payment–
This template is general information, not legal advice. Interest-rate limits (usury laws), tax rules for family loans and signing requirements differ by state and country.
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How to use the Promissory Note Generator
Enter the lender and borrower with full legal names and addresses, and add a co-signer if there is one.
Set the loan: amount, currency, annual interest rate and the date of the note.
Choose the repayment plan: number and frequency of payments and the first due date, or a single due date.
Add late fee, collateral and default terms as needed and pick the governing state.
Check the payment summary and schedule, then download the PDF, print it and have the borrower sign.
Repayment plans compared
Example: $10,000 at 5% per year.
Plan
Payments
Total interest
Good for
Equal monthly installments, 24 months
24 × $438.71 (last $438.81)
about $529.14
Steady repayment from a regular income
Interest-only, 24 months, then principal
23 × $41.67, then $10,041.67
about $1,000
Borrowers expecting a large sum later, such as a home sale
Lump sum after 1 year (365 days)
1 × $10,500
$500
Short-term loans repaid in one go
The amortization formula
Installment = P × r ÷ (1 − (1 + r)−n), where P is the loan amount, r the periodic rate (annual rate ÷ 12 for monthly, ÷ 26 for every two weeks, ÷ 52 for weekly) and n the number of payments. For each payment, interest = remaining balance × r and principal = payment − interest. Early payments are mostly interest; later payments are mostly principal. With a 0% rate, each payment is simply P ÷ n.
Tips for a family or personal loan
Use full legal names and current addresses for everyone who signs.
Give each person a signed copy, and keep a record of every payment received (the schedule CSV works as a simple ledger).
Pick realistic dates: align payments with the borrower's payday.
Check your state's maximum interest rate and, for larger US loans, the IRS Applicable Federal Rate.
Describe collateral precisely (make, model, serial or VIN) if the note is secured.
Frequently asked questions
What is a promissory note?
A promissory note is a written, signed promise by a borrower to pay a lender a set amount of money, with or without interest, on stated dates. It is simpler than a full loan agreement but still records the amount, interest, repayment plan and what happens if payments are missed.
How is the installment payment calculated?
For equal installments the tool uses the standard amortization formula: payment = P x r / (1 - (1 + r)^-n), where P is the principal, r the annual rate divided by the number of payments per year, and n the number of payments. Each payment's interest is the balance times r; the rest reduces the principal, and the last payment absorbs rounding.
How is interest calculated for a lump-sum note?
As simple interest: principal x annual rate x days / 365, counting the actual days from the date of the note to the due date. For example, $10,000 at 5% for 365 days is $500, so $10,500 is due.
Does a promissory note need to be notarized?
Usually not. In most US states a promissory note is valid when signed by the borrower. Some people add a witness or notary for extra proof, and secured notes involving real estate normally need a separate recorded mortgage or deed of trust.
Can I lend money to family at 0% interest?
You can, but in the US the IRS may treat below-market loans above certain amounts as partly a gift and expect interest at least at the Applicable Federal Rate (AFR), which it publishes monthly. Loans of $10,000 or less between individuals are generally exempt. Check the current AFR or ask a tax professional for larger loans.
What is the difference between secured and unsecured notes?
An unsecured note is backed only by the borrower's promise. A secured note names collateral, such as a car, that the lender may claim if the borrower defaults. Depending on the property, the lender may also need to file or record the security interest, for example on a vehicle title.
Is there a limit on the interest rate?
Yes, most states have usury laws that cap interest on personal loans, and the caps vary. The note includes a clause limiting interest to the maximum lawful rate, but you should still choose a rate that is legal in your state.
Are all the tools on FreeToolCabin tested for quality and accuracy?
Yes! Every tool on our site undergoes automated Q/A testing in real browser environments to ensure high precision, correct output, and zero errors. If you happen to spot a bug or have a suggestion, please contact us at [email protected] and our team will review it right away.