A Kansas unsecured promissory note is a legally binding agreement where a borrower promises to repay a lender an unsecured loan and interest. However, this type of note is riskier for the lender than the secured version, as there is no collateral in the case of a default. Therefore, the lender should only work with family, friends, or borrowers with good credit.
An unsecured promissory note establishes the loan amount, interest rate, refund date, and penalties for late payments. If the borrower fails to pay, the lender may initiate collection efforts, such as hiring a professional collection agency or suing the borrower in court.
