In the state of Texas, the promissory note template provides the lending party with security that money loaned to the borrower will be reimbursed. The Texas promissory note template helps lenders collect loans from the borrower in a legal way.

If you are planning to lend or borrow money, make sure both parties sign the Texas promissory note to avoid future legal issues relating to loan repayment. In this article, we will be discussing Texas promissory note and when it should be used. Moreover, you will also learn how to write Texas promissory notes.

What Is a Texas Promissory Note?

Texas promissory note is a legally enforceable document that contains key details with regards to loan transactions between lenders and borrowers. Of note, the lender can be any individual or bank.

In this contract, the lender agrees to offer a certain amount of loan whereas the borrower promises to repay the loan on agreed-upon time. Texas promissory notes are more detailed legally binding as opposed to a simple IOU form.

In Texas, this promissory note also requires a co-signer who approves that he/she will satisfy the loan in case the borrower fails to make a loan repayment. This signature of witness along with signs of lender and borrower gives Texas promissory note a legal validity.

Mainly, there are two types of Texas promissory notes, namely ‘Texas Secured Promissory Note’ and ‘Texas Unsecured Promissory Note’. Broadly speaking, secured notes are backed by any property or asset as additional security. In contrast, an unsecured note does not allow the lender to secure any asset for money loaned.

If you have a trustworthy borrower, you can use an unsecured promissory note. However, if you are unsure about the credibility of the borrower, the use of a secured promissory note is highly recommended.

When Should You Use a Texas Promissory Note?

Texas promissory note is used whenever lending money to a borrower. This document is used by both lenders and borrowers as it outlines terms of the loan including principal loan amount, interest rates (if any), payment structure, late fees, and penalties, and so on.

Both parties use this promissory note Texas form to avoid insecurities regarding money loaned and future legal issues. Usually, two kinds of promissory notes are used. Lenders can either use secured notes or unsecured notes depending on varying situations.

More importantly, lenders use secured promissory notes that are secured by any collateral which is pledged by the borrower. This collateral can be any property or asset such as home or vehicle.

On the other hand, lenders are more inclined to use unsecured promissory notes when the borrower is any trustworthy friend or relative.

How to Write a Texas Promissory Note?

When it comes to writing a Texas promissory note, make sure you mention whether the promissory note is a secured or unsecured note. Besides, promissory note Texas form must include information about both lender and borrower along with loan terms.

Initially, you will need to download the Texas promissory note template. Then you will need to proceed with the following elements:

  • Enter the start date of the document
  • Write the names of both borrower and lender
  • The complete email address of both lender and borrower
  • Principal loan amount
  • Interest rate (if any)

After that, you have to enter the details about the payment method, the due date for loan repayment, late fees, and accrued interest.

Of note, if it is a Texas secured promissory note, make sure it includes a detailed description of collateral that is pledged by a borrower to satisfy loan payment. In Texas promissory notes, different clauses are used for creating specific loan terms. These clauses include:

  • Interest rate which is due in case of borrower’s default on the loan
  • Allocation of payment
  • Prepayment
  • Acceleration
  • Fees and cost of an attorney
  • Waiver of presentments
  • Severability (in case portion of the note is invalid)
  • Conflicting terms
  • Notice
  • Name of co-signer
  • Governing law

Lastly, signatures of both parties are required on the note along with the signature of witness with full date.

Don't forget to celebrate your signing experience!

CocoSign, is simply document signing for each business. You could build a stonger relationship and share your experience with each client and partner.

Get started now


Lenders and borrowers in Texas should use promissory notes whenever lending or borrowing money. Texas promissory note helps lenders avoid legal issues pertaining to loan repayment, specifically when there is doubt on borrower and his/her credit history.

You can download a great template for Texas promissory note on our website CocoSign. So what are you waiting for? Visit our website and download any template for a promissory note that best matches your needs.


CocoSign represents a wide collection of legal templates covering all types of leases, contracts and agreements for personal and commercial use. All legal templates available on CocoSign shall not be considered as attorney-client advice. Meanwhile, CocoSign shall not be responsible for the examination or evaluation of reviews, recommendations, services, etc. posted by parties other than CocoSign itself on its platform.