A New Mexico promissory note is a concise, legally binding agreement between lender and borrower, outlining repayment terms, interest rate, and loan maturity date without requiring government filing.
Simplified compared to formal loan agreements, it is typically used among individuals and entities, offering two specific versions for New Mexico. This document ensures enforceability and serves as court evidence if the borrower defaults.
Laws: Promissory notes fall under Chapter 56, Article 8.
Statute of Limitations: Six years (§37-1-3).
By Type
Usury Laws and Interest Rates
The promissory note must adhere to New Mexico’s usury laws as outlined in Chapter 56, Article 8:
- With a Contract: No specified Limit.
- Without a Contract (§ 56-8-3): 15%
- For Loans to Corporations/Businesses (§ 56-8-9(B)): No cap, except on farm/agriculture mortgages (§ 56-8-10).
- For Judgments: 8.75% (§ 56-8-4); exceptions include:
- Different rates on written instruments.
- 15% per annum for judgments from tortious acts or bad faith.
- 10% per annum in claims involving tortious acts or bad faith if the trial is delayed by the plaintiff.
- 10% per annum in claims involving tortious acts or bad faith if the defendant offered a reasonable settlement.
- For Open Account (§ 56-8-5): 15%, can be higher if agreed.
- For Child Support Cases: 4% (§40-4-7.3).
