A Missouri promissory note is a legal document that outlines the terms of a loan between a lender and a borrower. It includes details such as the loan amount, interest rate, repayment schedule, and penalty fees for late payments. If applicable, both parties and a co-signer must sign the note, and two witnesses may also sign.
If the borrower defaults, the lender may use the note to take legal action. State law requires lenders to provide borrowers with receipts for each payment, and upon full repayment, the lender must mark the note as paid and return it to the borrower.
Laws: Title XXVI Trade and Commerce, § 400.9-408, governs the creation and implementation of promissory notes.
Statute of Limitations: Ten years.
By Type
Usury Laws and Interest Rates
Promissory notes must comply with Missouri’s usury laws, which you can find in Title XXVI, Chapter 408:
- With a Contract (§ 408.030): 10%, unless the interest rate exceeds 10%, the interest charged cannot be more than the market rate. The parties may also choose to pay a $10 fee instead of interest. (§ 408.031).
- Without a Contract (§ 408.020): 9%
- For Judgements (§ 408.040(3)): Federal Funds Rate + 5%
- In General (misdemeanor) (§ 408.095): 2% per month
- For Secured Personal Credit Loans (§ 367.021(2)): 2% per month
- Loans without Interest Limit (§ 408.035):
- Loan to a corporation, GP, LP, LLC;
- Credit extensions for agricultural, business, or commercial purposes;
- Non-residential real estate loans; or
- Loans secured solely by stocks, bonds, bills, CDs, or receipts over $5,000.
