Promissory Note With Balloon Payment With Interest In Suffolk
Category:
State:
Multi-State
County:
Suffolk
Control #:
US-00425BG
Format:
Word;
Rich Text
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Description
A Balloon Note is a Promissory Note that has one large payment (the balloon payment) that is due upon maturity. A balloon note will often have the advantage of a very low interest rate, thus requiring little capital outlay during the life of the loan. The major problem with such a loan is that the borrower needs to be self-disciplined in preparing for the large balloon payment due when the loan matures. Of course refinancing the note upon maturity is always a possibility.
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FAQ
Promissory notes remain valid for a duration of 3 years from the date of execution, after which they expire and become invalid. No maximum limit for which amount can be lent or borrowed.
There is not a federal usury law that sets limits on interest rates. There are state level usury laws, but they vary significantly by state. Also, the interest limits placed on a credit card issuer are determined by the state where they are based, not where a credit card holder lives.
Promissory notes with balloon payments are a financing option you may be considering for your business. These types of loans may be secured by collateral or not, but they always end their repayment schedule with a big payment, known as the balloon payment.