A Virginia unsecured promissory note formalizes a loan agreement where a borrower accepts a loan from a lender without providing assets as collateral. The note emphasizes the conditions under which the borrower must repay the specified sum. The lender can implement penalties for late payments, such as additional late fees or an increased interest rate.
Please note that if the borrower defaults on the loan, the lender’s primary recourse is to initiate legal proceedings to recover the funds the borrower owes them. Because of the difficulty in pursuing recourse for an unsecured loan, a lender should only issue it to people with a proven record of financial stability or with whom they have mutual trust.
