Free Colorado Promissory Note

Promissory Note Colorado: Get The Essential Requirements Right

Whenever you lend money to a friend, you expect to get the entire sum promptly. Contrary to your expectation, your friend may not honor the agreement, leaving you regretting why you had to lend in the first place.

But that shouldn’t worry you anymore because a promissory note is a handy document that cushions you against bad debts. The note is enough proof that you entered a financial transaction with a borrower and expected payback on an agreed date.

Here you’ll learn about a promissory note in Colorado and how to create a customized note.

What Is a Colorado Promissory Note to Pay Debt?

A Colorado promissory note is a legal document outlining an agreement between a lender and a borrower such that the lender gives a loan while the borrower promises to pay.

In Colorado, a promissory note for loan payment is a security document, hence subject to regulation and enforcement under the law. Therefore, the Colorado Revised Civil Procedures provide a guideline for the enforcement of promissory notes.

Like other states, a Colorado promissory note loan agreement comes in two types:

Secured Promissory Note for Payment

A secured agreement includes a property to cover the loan if the borrower can’t repay it. Legally, the lender reserves the right to take the property that the borrower set as collateral to pay the loan fully or partially.

Unsecured Short Term Promissory Note

An unsecured promissory note doesn’t have collateral to cover the loan and depends on mutual trust between the lender and borrower. However, the lender can still recover the loan through a legal suit, sharing the borrower’s information with a credit bureau or a small claims court.

Since it depends on mutual trust, an unsecured note is only ideal for close friends and family members’ short term loan.

Colorado Promissory Note: Interest Rate

Colorado regulates the maximum interest rate lenders can charge for a loan. The Colorado Revised Statutes Title 5 contains the Usury laws applicable in Colorado.

Under the laws, the maximum interest for a loan shouldn’t exceed 8% per annum if parties do not have an official agreement. If parties have an authorized agreement such as a promissory note, the maximum interest is 45%. Consumer loans, however, can have up to a 12% interest rate.

How to Write a Conditional Colorado Promissory Note?

Before creating a promissory note, you should first decide whether you want a secured or unsecured agreement.

Ensure you indicate “Secured Promissory Note” if the title is secured. Without an appropriate title, the courts may treat the contract as unsecured.

Having titled the document, your next step would be to write the basic information as follows:

The Date

Write the date, the month, day, and year.


Suppose you borrowed the loan, including your full name and mailing address. For a secured loan, include your physical address, just in case the lender may want to retrieve collateral. Similarly, the note should have the lender's name and the mailing address.


It is the amount you receive from the lender, without including the interest you’ll pay. Review the principal amount to ensure you write an accurate figure.


The interest rate is generally an annual percentage of the loan borrowed. Consumer loans can have an interest as high as 12% and 45% for official agreements.

Payment Information

Most lenders in Colorado accept payments in weekly, biweekly, and monthly installments. Besides installments, you should also specify how much you’ll pay in each installment. If your lender charges a fee for late payment, also include it in the payment information.


As a requirement by Colorado laws, both parties to a promissory note contract should print their names and append their signatures on the document. The contract's date also appears in the final section of the promissory note.

Are you looking forward to lending money to someone? Consider getting a free template of basic Colorado promissory note online to protect your interests.