Promissory Note Template Texas

PROMISSORY NOTE (SECURED/UNSECURED)

Document ID: PN-TX-[YYYY]-[XXXX] Effective Date: [Effective Date] Version: 1.0 Governing Jurisdiction: State of Texas

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LEGAL DISCLAIMER

This document is a template provided for informational purposes by a legal professional persona. It does not constitute attorney-client privilege or specific legal advice. Promissory notes in Texas are subject to the Texas Finance Code and common law. Users must verify compliance with Texas usury laws (Tex. Fin. Code Ann. § 301 et seq.) and specific lien requirements if securing this note with real or personal property. Consult with a licensed Texas attorney before execution.

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1. PARTIES

BORROWER: [Borrower Full Legal Name], a [State of Incorporation/Residence] [Entity Type/Individual], with a principal place of business/residence at [Full Address] ("Borrower").

LENDER: [Lender Full Legal Name], a [State of Incorporation/Residence] [Entity Type/Individual], with a principal place of business/residence at [Full Address] ("Lender").

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2. PROMISE TO PAY

FOR VALUE RECEIVED, the Borrower unconditionally promises to pay to the order of Lender the principal sum of [Amount in USD] (the "Principal Amount"), together with interest on the unpaid principal balance at the rate of [Interest Rate]% per annum, computed on the basis of a 365-day year.

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3. REPAYMENT TERMS

The Principal Amount and accrued interest shall be paid as follows: (a) Installments: Borrower shall make [Number] consecutive monthly payments of $[Amount] beginning on [Start Date], and continuing on the same day of each month thereafter until [Maturity Date]. (b) Maturity: The entire unpaid principal balance and all accrued but unpaid interest shall be due and payable in full on [Maturity Date] (the "Maturity Date"). (c) Application of Payments: All payments shall be applied first to accrued interest, then to the reduction of the Principal Amount.

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4. PREPAYMENT

Borrower reserves the right to prepay the Principal Amount in whole or in part at any time without penalty. Any partial prepayment shall not postpone the due date of any subsequent installment unless agreed upon in writing by Lender.

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5. DEFAULT AND ACCELERATION

The occurrence of any of the following shall constitute an "Event of Default": (a) Failure to pay any installment of principal or interest within [Number] days of the due date. (b) The filing of bankruptcy, insolvency, or reorganization proceedings by or against the Borrower. (c) Breach of any material representation or covenant contained herein.

Upon an Event of Default, Lender may, at its option, declare the entire unpaid principal balance and all accrued interest immediately due and payable without further notice or demand.

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6. LATE FEES AND INTEREST ON OVERDUE AMOUNTS

If any payment is not received by the Lender within [Number] days of its due date, Borrower shall pay a late charge of $[Amount] or [Percentage]% of the overdue amount, whichever is greater. Any amount not paid when due shall bear interest at the maximum rate permitted by applicable Texas law.

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7. GOVERNING LAW AND VENUE

This Note shall be governed by, construed, and enforced in accordance with the laws of the State of Texas, without regard to its conflict of laws principles. Any legal action arising hereunder shall be instituted exclusively in the state or federal courts located in [County Name], Texas.

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8. WAIVER AND AMENDMENT

No failure or delay by Lender in exercising any right under this Note shall operate as a waiver thereof. This Note may only be amended or modified by a written instrument signed by both Borrower and Lender.

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9. COLLECTION COSTS

If this Note is placed in the hands of an attorney for collection after an Event of Default, Borrower agrees to pay all reasonable attorneys' fees and court costs incurred by Lender, to the extent permitted by Texas law.

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10. ENTIRE AGREEMENT

This Note constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior discussions, negotiations, and understandings.

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11. EXECUTION

FOR [BORROWER NAME]: Signature: _____________________________________ Printed Name: [Authorized Signatory Name] Title: [Title / Role] Date: [Date]

FOR [LENDER NAME]: Signature: _____________________________________ Printed Name: [Authorized Signatory Name] Title: [Title / Role] Date: [Date]

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STEP-BY-STEP EXECUTION AND FILING GUIDE

1. Information Completion: Replace all bracketed text [...] with specific, accurate data. Ensure the [Interest Rate] complies with Texas Usury caps (Chapter 303, Texas Finance Code).
2. Reviewing Signatory Authority: Ensure the individual signing for an entity has the express written authority (via Corporate Resolution or Operating Agreement) to bind said entity to debt obligations.
3. Notarization: While not strictly required for a simple promissory note, having the document notarized (specifically an Acknowledgment) is recommended to prevent future claims of forgery.
4. Digital Execution: Use platforms like DocuSign or Adobe Sign to ensure the audit trail of the signing process is captured, fulfilling federal E-SIGN Act requirements.
5. Record Retention:
   • Original Copy: Store the original signed document in a fireproof, secure location.
   • Digital Backup: Maintain a high-resolution PDF scan in a secure, encrypted cloud repository.
   • Notice: If this note is secured by real property, the note and the associated Deed of Trust must be recorded in the County Clerk’s office where the property is located.