Promissory Notes

Short-term Commercial Promissory Notes

Promissory note from 1840 for $1000A promissory note is a form of debt similar to a loan. It specifically promises to pay and spells out the terms rather than an IOU which only acknowledges that a debt exists. Companies issue the notes to finance their business. In return they agree to pay a fixed rate over a period of time. Legitimate promissory notes are not risk-free. The company may run into problems and not be able to make interest or principal payments.

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