A Utah promissory note is a critical legal tool that facilitates the lending and borrowing of money. It offers lenders protection because it puts the financial agreement in writing and provides borrowers with access to funds they may need to make a big purchase, fund their education, or complete another costly goal.
The parties can agree to a “secured” note in which the borrower provides collateral or an “unsecured” note, which comes with a higher interest rate due to the increased risk but doesn’t require collateral. Within either type of promissory note, you can find essential details such as the loan amount, interest rate, co-signer information, repayment schedule, security, and late payment penalties.
Laws: Title 70A, Chapter 3 of the Utah Code regulates promissory notes in Utah.
Statute of Limitations: Six years (§ 70A-3-118).
By Type
Usury Laws and Interest Rates
Promissory notes must abide by the state’s usury laws present in Title 15, Chapter 1 (Interest Rates):
- Without a Contract (§ 15-1-1(2)): 10%.
- With a Contract (§ 15-1-1(1)): No limit.
- For Judgments Under $10,000 (§ 15-1-4(4)): Must bear interest at the federal post-judgment rate plus 10%.
- For Judgments in General (§ 15-1-4(3)): Must bear interest at the federal post-judgment rate plus 2%.
