A Mississippi promissory note is a legal document that outlines the terms of a loan agreement between two parties. It includes details such as interest rates, payment types, late fees, and personal information of both parties. By signing this document, the borrower agrees to repay the loan according to the terms set by the lender.
This note records the transaction and provides the lender with legal protection in case the borrower defaults on the loan.
Laws: MS Code § 15-1-81 governs the creation and implementation of promissory notes.
Statute of Limitations: Six years. (§ 15-1-81)
By Type
Usury Laws and Interest Rates
Promissory notes must comply with Mississippi’s usury laws, which you can find in Miss. Code Ann. § 75-17-1:
- With a Contract (§ 75-17-1(2)): Not to exceed 10% per annum or 5% above the Federal Reserve discount rate, whichever is greater.
- Without a Contract: (§ 75-17-1(1)): Not more than 8% per annum
- For Judgements (§ 75-17-7): As stated in the contract, or if no contract, as determined by the judge.
- For Business Entities and Religious Societies (§ 75-17-1(3)): 15%, or 5% above the 90-day commercial paper discount rate on amounts over $2,500, whichever is greater.
- For Consumer Loans (§ 75-17-21 & § 75-67-181):
- A monthly finance charge (instead of interest) not to exceed an APR of 59% of the unpaid balance on loans of $5,100 or less
- 36% of unpaid balance on loans of $1,000 or less
- 33% of unpaid balance on loans between $1,000 and $2,500
- 24% of the unpaid balance on loans between $2,500 and $5,000
- 14% of the unpaid balance on loans over $5,000
In case of $25,000 or more loans, the licensee can charge a maximum finance fee of 18% of the remaining balance per annum instead of the consumer loan interest rates mentioned above.
- For General/Limited Obligation Tax Bonds (§ 75-17-101): 11% per annum
- For Revenue Bonds (§ 75-17-103): 13% per annum
- For Tax Anticipation Notes (§ 75-17-105): 11% per month
- For Interim Financing (§ 75-17-107): 9% per annum
- For Pawnbrokers (§ 75-67-313): 25% per month
- For Installment Loans (Weekly/Monthly) (§ 75-67-39): 7%* per annum
*As per the law stated in § 75-67-39, a loan agreement can have a clause that allows the borrower to be charged an interest rate of 10% if they pay off the loan before the due date or if the lender defaults on the agreement and demands immediate payment of all outstanding balances (§ 75-67-41).
