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Printable Release of Promissory Note Document

The Release of Promissory Note form is a legal document that signifies the cancellation of a promissory note, releasing the borrower from any further obligations under the note. This form serves as proof that the debt has been satisfied or forgiven. Understanding this document is essential for both lenders and borrowers to ensure clarity in financial transactions.

Form Sample

Release of Promissory Note

This Release of Promissory Note ("Release") is made as of the ___ day of __________, 20___, by and between:

Debtor: _______________________________________ (the "Debtor")

Address: ______________________________________

City, State, Zip Code: ________________________

and

Creditor: _____________________________________ (the "Creditor")

Address: ______________________________________

City, State, Zip Code: ________________________

This Release pertains to the Promissory Note dated the ___ day of __________, 20___, in the original principal amount of $________________ (the "Note"), executed by the Debtor in favor of the Creditor.

In consideration of the payment made by the Debtor to the Creditor and receipt of said payment, the Creditor hereby releases and discharges the Debtor from any and all further obligations under the Note.

This Release shall operate as a full and final discharge of the Debtor from the Note. The Creditor relinquishes any claims, rights, or actions against the Debtor regarding the Note.

By signing this Release, both parties acknowledge and affirm that:

  1. They have the authority to enter into this agreement.
  2. This Release is effective upon execution.
  3. The laws of the State of __________________ govern this Release.

IN WITNESS WHEREOF, the parties have executed this Release on the day and year first above written.

Debtor Signature: _______________________________

Date: ______________________________________

Creditor Signature: ____________________________

Date: ______________________________________

Misconceptions

The Release of Promissory Note form is often surrounded by various misconceptions. Understanding these misconceptions can help individuals navigate the complexities of financial agreements more effectively. Below are seven common misconceptions along with explanations to clarify them.

  • Misconception 1: The form is only necessary for large loans.

    • This is not true. The Release of Promissory Note form is applicable to any promissory note, regardless of the loan amount. It serves to formally acknowledge the repayment of the debt.

  • Misconception 2: Signing the release means the borrower can never borrow again from the lender.

    • In reality, signing the release does not prevent future borrowing. It simply indicates that the specific loan referenced in the note has been satisfied.

  • Misconception 3: The release must be notarized to be valid.

    • While notarization can add an extra layer of verification, it is not a legal requirement for the release to be effective. The essential element is the mutual agreement between the parties.

  • Misconception 4: The lender must provide a release form upon request.

    • This is misleading. While it is good practice for lenders to provide a release upon repayment, they are not legally obligated to do so unless specified in the original loan agreement.

  • Misconception 5: The release form is a one-size-fits-all document.

    • This is incorrect. The form should be tailored to reflect the specific terms of the promissory note and the circumstances surrounding its repayment.

  • Misconception 6: Once the release is signed, the lender has no recourse if the borrower defaults on another loan.

    • This is a misunderstanding. The release pertains only to the specific loan noted. Any new loans or agreements would require separate documentation and terms.

  • Misconception 7: The release can be ignored once signed.

    • This is not advisable. The signed release serves as a legal document that protects both parties. Ignoring it could lead to disputes or misunderstandings in the future.

Key takeaways

When filling out and using the Release of Promissory Note form, consider the following key takeaways:

  • Ensure that all parties involved in the promissory note are clearly identified on the form.
  • Double-check that the details of the original promissory note, including the amount and date, are accurately reflected.
  • Include a statement indicating that the debt has been paid in full or otherwise satisfied.
  • Both the lender and borrower should sign the form to acknowledge the release of the obligation.
  • Keep a copy of the completed form for your records, as it serves as proof of the release.
  • Consider having the document notarized to add an extra layer of authenticity and legal standing.

Check out Popular Types of Release of Promissory Note Templates

Simple Promissory Note - A promissory note can include clauses regarding late payment fees and grace periods.

For those looking to formalize a loan agreement, understanding the significance of the Promissory Note is essential, as it not only outlines the repayment terms but also ensures both parties are protected legally throughout the lending process.