New York Promissory Note (2026)

A secured or unsecured loan note with installment or lump-sum repayment, interest within your state's legal limit, late fees and default terms.

Updated September 2026≈ 7 minReviewed against N.Y. Gen. Oblig. Law § 5-501 · N.Y. Penal Law § 190.40 · N.Y. C.P.L.R. § 5004

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What you'll get

Sample first page of the Promissory Note. Your answers fill in the blanks; the clauses required in New York are added automatically.

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What this document covers

Borrower, lender and optional cosigner
Principal, date and purpose (personal or business)
Interest rate checked against the state usury ceiling
Installments, lump sum or on demand with amortized payment
Late charge and default interest
Usury savings clause
Default, cure period and acceleration
Collateral and UCC or title lien
Prepayment without penalty
Cosigner notice (FTC / California)

New York rules that this document follows

Maximum interest (private loans)	16% per year for personal/household loans; loans to business entities exempt; loans over $250,000.00 exempt — 16% per year max by written contract (civil usury); loans of $250,000 or more are exempt from civil usury, and loans of $2,500,000 or more from all usury; corporate borrowers may not assert civil usurySource: N.Y. Gen. Oblig. Law § 5-501
Criminal usury threshold	25%Source: N.Y. Penal Law § 190.40
Legal rate when none is stated	9%Source: N.Y. C.P.L.R. § 5004
Late fees	No statutory cap on late fees for private (non-consumer-lender) loans; fee must be a reasonable liquidated-damages estimate and, together with interest, must not push the effective rate above the usury ceiling
Cosigner notice	Included when a cosigner is namedSource: 16 C.F.R. § 444.3
Time to sue on a written note	6 yearsSource: N.Y. C.P.L.R. § 213(2)
Notarization / witnesses	Not required (optional for evidentiary value)

Rules current as of 2026-10-27. Statutes change; verify before relying on them.

How to use this Promissory Note in New York

Keep the interest rate at or below the New York ceiling shown above; a usurious note can cost the lender all interest and more, and late fees count toward the ceiling. For loans between family members, the IRS applicable federal rate (AFR) is the minimum to avoid imputed-gift issues on loans above $10,000.

If a cosigner signs, give them the Notice to Cosigner (Section 7) before they sign — in California and under the FTC rule the guaranty is unenforceable without it.

Sign one original; the lender keeps it and the borrower keeps a copy. When the note is paid, the lender should mark it 'PAID IN FULL' and return it.

Frequently asked questions

What is the maximum interest rate I can charge in New York?

16% per year for a personal, family or household loan; loans to corporations/LLCs are exempt; loans over $250,000.00 are exempt (N.Y. Gen. Oblig. Law § 5-501). 16% per year max by written contract (civil usury); loans of $250,000 or more are exempt from civil usury, and loans of $2,500,000 or more from all usury; corporate borrowers may not assert civil usury Above 25% is criminal usury regardless of any exemption.

Does a promissory note need a notary or witnesses?

No. A note signed by the borrower is enforceable in New York. Notarizing is optional. For a loan secured by a titled vehicle, have the lien noted on the certificate of title at the DMV — a UCC-1 does not perfect a lien on a titled vehicle; for equipment or other goods, file a UCC-1 financing statement.

How long can the lender sue on an unpaid note?

6 years from default (N.Y. C.P.L.R. § 213(2)).

Why does the note ask whether the loan is personal or business?

Most usury statutes set a lower ceiling for personal, family or household loans and exempt or raise the ceiling for business loans, loans to entities, or large loans. The borrower's written representation in Section 1 is what a court looks at to decide which ceiling applies — so it must be truthful.

Other names

loan agreement
IOU
personal loan contract
secured promissory note
family loan agreement
demand note
installment note
loan note

Other states

FormsByState provides self-help document templates and general information, not legal advice. We are not a law firm. For advice about your situation consult a licensed attorney in your state.