Hawaii Promissory Note Template [PDF + Download]

A promissory note in Hawaii is a legally binding document that outlines a borrower's promise to repay a debt to a lender. It is often part of a loan agreement and specifies key loan terms, including the amount, due date, payment schedule, and interest rate.

Understanding the meaning of a promissory note is essential for both lenders and borrowers to ensure clarity and enforceability of the loan terms.

This article will delve into the structure and content of a promissory note, explain its key elements, and provide a promissory note sample to help you create a valid document that protects both parties involved.

Types of Promissory Notes in Hawaii

Promissory notes in Hawaii are categorized into two main types—secured and unsecured, each offering different levels of protection for the lender.

Types of Promissory Notes

#1. Secured Promissory Note

A secured promissory note is backed by an asset owned by the borrower, which serves as collateral. So, if the borrower fails to repay as agreed, the lender has the right to seize the asset to recover the debt. This type of promissory note provides the lender with more security in case of default.

#2. Unsecured Promissory Note

Unlike secured notes, unsecured promissory notes rely solely on the borrower's promise to repay the debt. There is no collateral involved, which means that if the borrower defaults, the lender has no specific asset to claim and must rely on legal action or the borrower's financial ability to recover the funds.

Signing Requirements for Promissory Notes in Hawaii

Hawaii promissory note requirements outline the essential elements that must be included for the note to be legally recognized.

Let’s see what these requirements are:

Signing Requirements

The document must be in writing.
It should clearly identify the parties—the borrower and lender.
It must include key details from the Hawaii debt agreement, such as the loan amount, repayment terms, interest rate, and late fees.
Both parties must sign the document.

Once these elements are in place, the promissory note can be used as evidence in court. For added validation, the parties should consider having the document witnessed or notarized by a notary public. Additionally, using an available promissory note template and customizing it to your loan arrangement is recommended to ensure all elements are included and correct.

Statutory Considerations for Hawaii Promissory Notes

Promissory notes in Hawaii must comply with the state’s usury laws, governed by the Hawaii Revised Statutes, Title 26, Chapter 478. These laws set interest rate caps to protect borrowers from excessive charges.

Loan Type	Interest Rates
General Loans (Section 478-2)	10% or contract rate
Judgments (Section 478-3)	10%
Home Business Loans (Section 478-4)	12% (1% per month) or 24% (regulated lenders)
Consumer Credit	12% (1% per month) or 24%

Promissory notes in Hawaii can be used for personal or business loans, provided they adhere to state regulations. To ensure validity, the loan agreement must include clear terms, a written agreement for any interest exceeding 10%, and compliance with all state-specific legal provisions.

How to Enforce a Promissory Note in Hawaii

To enforce a promissory note in Hawaii, begin by confirming that the borrower has defaulted on their repayment obligations as outlined in the note. Next, send a written demand for payment, giving the borrower an opportunity to settle the debt voluntarily.

If the borrower does not respond or refuses to pay, the lender can file a claim in Hawaii’s small claims court for amounts up to $5,000. For larger debts, the lender will need to take legal action in a higher court.

If the court rules in the lender’s favor, they may obtain a judgment allowing them to pursue further options. These include wage garnishment, where a portion of the borrower’s income is redirected to the lender.

A clearly written and signed enforceable promissory note in Hawaii strengthens the lender’s case and ensures they have the legal backing to recover unpaid debts effectively.

How Can a Promissory Note in Hawaii Be Changed or Revoked?

A promissory note in Hawaii can be changed or revoked if both parties agree to it. For example, the lender and borrower might decide to adjust the repayment terms or end the agreement entirely. In both of those cases, it's crucial to document any changes in writing to avoid future disputes.

The revised terms or revocation should be clearly stated in a new document or added as an amendment to the original note. Both parties must sign the updated agreement to make it legally binding.

Proper documentation ensures that the updated terms of the repayment agreement in Hawaii are enforceable and that both sides are protected in case of disagreements later on.