A promissory note is like an "I owe you" document that includes all of the guidelines for repayment. It is the written promise or agreement to pay back the loan using the agreed-upon terms. These terms include:
Once the loan is paid in full, the promissory note is given back to the borrower. If you fail to uphold the responsibilities outlined in the promissory note (i.e. pay back the money you borrowed), the lender can take ownership of the property.