West Virginia Promissory Note Template [PDF + Download]

A West Virginia promissory note is a written agreement in which a borrower promises to repay a debt to a lender. The document stipulates the repayment terms, potential penalties in case of default, due dates, interest rates, and other related information.

Promissory notes in this state are legally binding, provided that issuers meet the signing requirements and respect interest rate limits. They can also be used for formalizing West Virginia loan agreements.

In West Virginia, you can hire a lawyer to issue this legal document for you, which is usually more costly and time-consuming, or create it yourself by using promissory note templates. In this guide, we explain the meaning of promissory notes and teach you how to enforce, revoke, or amend them.

Types of Promissory Notes in West Virginia

Promissory notes in West Virginia can be secured and unsecured. The main difference between the two lies in how you can enforce them.

Let’s explore this in more detail:

Types of Promissory Notes

#1. Secured Promissory Note

Secured promissory notes are easier to enforce than unsecured ones if the borrower is late on payments or unable to pay off the debt.

This is because secured promissory notes propose collateral, a piece of the borrower’s property or asset (e.g., a boat or house). In default cases, the lender can seize collateral and sell it to recover the debt. Also, the enforcement process for secured notes is shorter, so the enforcement costs of such West Virginia repayment agreements are typically lower than those for unsecured notes.

#2. Unsecured Promissory Note

Unsecured promissory notes do not have collateral and rely only on the borrower’s promise to pay off the debt. People mostly use these notes to lend money to someone they trust.

However, if the borrower defaults on payment, the lender has to take legal action, such as filing a case in small claims court to reclaim the loan amount stated in the West Virginia debt agreement. Recovering the debt this way takes considerable time and can also be expensive.

Signing Requirements for Promissory Notes in West Virginia

The signing requirements for a promissory note in West Virginia specify the obligatory elements that ensure the document's enforceability and validity.

Let’s examine them:

Signing Requirements

Promissory notes must be in written form.
They should outline the information regarding both parties (full names, addresses, etc.).
Notes must include the repayment terms, deadlines, potential penalties for late or missing payments, and collateral (applicable only for secured notes).
Both parties must sign the document to confirm its validity.

To further protect your document, you can have it witnessed or notarized. Although additional protection is not obligatory, it is highly recommended that you hire a notary public for loans exceeding $10,000.

Statutory Considerations for West Virginia Promissory Notes

Interest rates in West Virginia are subject to this state’s Usury Laws. Namely, Chapter 47, Article 6 (Money and Interest) regulates the maximum interest rates for all types of loans, as shown below:

Statutory Considerations

Without contract: 6% (§ 47-6-5(a))
With contract: 8% (§ 47-6-5(b))
Judgments: 2% over the Fifth Federal Reserve District secondary discount rate (§ 56-6-31(c))
Real estate loans before July 1, 1975: 9% (§ 47-6-5(c))

West Virginia promissory note makers should not exceed the interest rate limits, as this can have potential repercussions, such as interest rate annulments or the invalidation of the entire document. There are no exceptions for loan types (real estate, personal, business loans, etc.).

How To Enforce a Promissory Note in West Virginia

To enforce a promissory note in West Virginia, lenders must take legal action based on the authority that the notes grant.

For example, a secured enforceable promissory note in West Virginia allows the lender to sell the collateral previously defined in the agreement. The collateral value may be equal to or exceed the debt amount. In the latter case, the lender can return the extra funds to the borrower.

On the other hand, the lender can send a demand letter to the borrower before pursuing legal action if they are an unsecured promissory note holder. If the borrower disregards this legal payment request, the lender can seek restitution in small claims court for loans of $10,000 or less.

This process can be lengthy, but if the court rules in the lender’s favor, they can place a lien on the borrower’s property or recoup the debt with wage garnishments.

How Can a Promissory Note in West Virginia Be Changed or Revoked?

A promissory note in West Virginia can be changed or revoked only if the parties involved agree to such modifications.

Amendments or revocations of West Virginia promissory notes are common following changes in circumstances, such as early repayment, debt forgiveness, etc. In any case, when revoking or changing the note, the parties must create a new document that refers to the original one, clearly state all modifications or cancellation terms, and sign it.

Ensuring the legal force of promissory notes is always a priority. That said, parties can seek professional advice or use promissory note samples as a guide and check the necessary requirements, form, style, and language they should include and adhere to.