A West Virginia promissory note is a formal contract between two parties where one (the lender) agrees to lend money to the other (the borrower) under specified terms. This document clearly outlines crucial details such as the loan amount, interest rate, repayment schedule, and penalties for non-payment.
It’s less formal than other types of more intricate loan agreements, and it facilitates a mutual understanding between individuals who often have a prior relationship. It prevents disputes and acts as a safeguard, ensuring both parties are on the same page about the loan’s conditions.
Laws: Chapter 46, Article 3 of the WV Code details promissory notes and other negotiable instruments.
Statute of Limitations: Six years.
By Type
Usury Laws and Interest Rates
Whenever you create a promissory note, you must follow the state’s usury laws present in Chapter 47, Article 6 (Money and Interest):
- Without a Contract (§ 47-6-5(a)): 6%.
- With Contract (§ 47-6-5(b)): 8%.
- For Real Estate Loans (§ 47-6-5(c)): 9%.
