Promissory Note


  • A written promise made by a borrower to repay a loan by a specified date.

note payable, note


Related Terms and Acronyms

  • Bank Definition,
    • An institution that acts as a financial intermediary by receiving money from depositors and lenders and also lending to borrowers.
  • Co-maker Definition,
    • Any party that co-signs a promissory note. All co-makers assume responsibility for the loan if any of the other co-signers renege.
  • Co-signer Definition,
    • A person who signs a promissory note that is also signed by one or more other parties. All parties take responsibility for the debt if any of the others renege.
  • Demand Promissory Note (DPN)Acronym,
    • Lender Definition,
      • The bank or mortgage company offering the loan.
    • Loan Definition,
      • Letting another party use something of value temporarily.
    • Loan Commitment Definition,
      • A lender's promise to advance a specific sum on specific terms.
    • Loan Term Definition,
      • The period specified in the promissory note for a borrower to pay a loan, such as a mortgage. Most conventional mortgages have a loan term of 5 or 10 years.
    • Master Promissory Note (MPN)Acronym,
      • Mortgage (mtg) Abbreviation, Important,
        • A mortgage is a contract stipulating a specific real property, typically a residence or building, as collateral for a loan. The mortgage incurs a rate of interest that varies according to term and other features.
      • Note Definition,
        • A legal acknowledgement of a debt and an implicit promise to repay. It includes the loan amount, interest rate and term.
      • Term Definition,
        • The length of time you commit to repay a lender or bank at an agreed upon interest rate and payment schedule. The interest rate usually remains constant during this term unless the commitment states otherwise. For example, a five year fixed rate mortgage has a term of five years.
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