Florida Promissory Note
Florida promissory note template within the 18% usury cap and 5-year statute of limitations under state law. Free template. Attorney review available.
Introduction
In Florida, charging too much interest on a private loan is not just an unenforceable contract term, it can be a crime. On a loan under $500,000, the civil usury cap is 18% per annum; a lender who charges more forfeits the interest and, if it was already collected, owes the borrower double that amount. Cross 25% per annum and the lender is committing criminal usury, a second-degree misdemeanor; above 45% per annum it becomes a third-degree felony. A promissory note is the written, signed promise that puts a loan's terms, including its interest rate, in writing, made by one party, the maker, to pay a definite sum to another party, the payee, either on demand or by a set date. It's what turns a family loan, a small business loan, or a loan between friends into a debt the payee can actually enforce if the maker doesn't pay. A Florida promissory note doesn't need to be notarized or witnessed to be enforceable, and confession-of-judgment clauses (letting the payee get a court judgment without a lawsuit) are void under Florida law. You generally have 5 years from a missed payment or the note's due date to sue on a written note.
Key Things to Know
- 1
A promissory note is a written, signed promise by one party (the maker) to pay a definite sum of money to another party (the payee), either on demand or by a set date.
- 2
On a loan under $500,000, Florida's civil usury cap is 18% per annum simple interest. A lender who charges more forfeits the interest charged, and if usurious interest was already collected, must pay the borrower double that amount. (Fla. Stat. Section 687.03; Section 687.04)
- 3
Beyond the civil cap, Florida separately criminalizes high-rate lending: charging, taking, or receiving interest over 25% per annum but not more than 45% per annum is a second-degree misdemeanor, and over 45% per annum is a third-degree felony, regardless of loan size. (Fla. Stat. Section 687.071)
- 4
A Florida promissory note does not need to be notarized or witnessed to be enforceable. Florida Statute Section 673.1041 lists what makes a note a valid negotiable instrument (an unconditional promise, a fixed amount, a signature, payable on demand or by a definite date), and notarization isn't one of the requirements.
- 5
Confession-of-judgment clauses, which would let the payee obtain a court judgment against the maker without filing a lawsuit, are void in Florida. All powers of attorney to confess or suffer judgment by default or otherwise are absolutely null and void. (Fla. Stat. Section 55.05)
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You generally have 5 years from a missed payment or the note's stated due date to sue to collect on a written promissory note in Florida. (Fla. Stat. Section 95.11(2)(b))
- 7
If a Florida promissory note is secured by personal property rather than real property, the lender generally needs to file a UCC-1 financing statement to protect its priority against other creditors. (Fla. Stat. Section 679.3101)
Key decisions before you file
Before you file a Promissory Note in Florida, a few decisions shape the document: which option to choose and what each one means. The Promissory Note guide walks through them.
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Florida Requirements for Promissory Note
On a loan under $500,000, the maximum lawful rate is 18% per annum simple interest. Loans of $500,000 or more are not subject to this civil cap unless the rate exceeds the criminal usury threshold in Florida Statutes Section 687.071. A lender who charges more than 18% forfeits the entire interest charged.
Charging, taking, or receiving interest at a rate exceeding 25% per annum but not more than 45% per annum is a second-degree misdemeanor. Charging, taking, or receiving interest at a rate exceeding 45% per annum is a third-degree felony. These criminal thresholds apply regardless of loan size, separate from the civil usury cap in Section 687.03.
To be a valid negotiable instrument, a note must be an unconditional promise to pay a fixed amount, signed by the maker, and payable on demand or at a definite time.
Generally 5 years from a missed payment or the note's stated due date to sue to collect on a written promissory note.
All powers of attorney for confessing or suffering judgment to pass by default or otherwise are absolutely null and void under Florida law. A promissory note should not include a confession-of-judgment or cognovit clause.
If a note is secured by personal property, the lender generally must file a UCC-1 financing statement to perfect and prioritize its security interest against other creditors.
Chapter 516 license and rate requirements apply only to a person "engaged in the business of" making consumer finance loans of $25,000 or less at over 18% per annum. An isolated private person-to-person promissory note does not trigger these requirements.
Florida does not require a promissory note to be notarized or witnessed to be enforceable. Section 673.1041's list of what makes a note a valid negotiable instrument does not include notarization or witnessing; notarization is optional and used only for evidentiary purposes.
Frequently Asked Questions
On a loan under $500,000, Florida's civil usury cap is 18% per annum. A lender who charges more forfeits the interest, and if it was already collected, must repay the borrower double that amount. Charging over 25% per annum is criminal usury, a second-degree misdemeanor above 25% and a third-degree felony above 45%, regardless of loan size.
No. Florida Statute Section 673.1041 lists what makes a note a valid, enforceable negotiable instrument, and notarization isn't one of the requirements. Notarizing a note is optional and can help as evidence of who signed it, but it doesn't affect enforceability.
Include the principal amount, the interest rate (within Florida's usury cap), the repayment schedule, what counts as default, and the signatures of the maker and payee. Since confession-of-judgment clauses are void in Florida, don't include one; the note relies on a regular lawsuit for enforcement if the maker defaults.
Yes, as long as it meets the basic requirements of a valid contract and, if it's meant to be a negotiable instrument, the elements in Florida Statute Section 673.1041: an unconditional promise to pay a fixed amount, a signature, and payment on demand or by a definite date. It doesn't need to be notarized to be enforceable.
An unsecured note relies only on the maker's promise to pay. A secured note is backed by collateral, and if it's secured by personal property rather than real estate, the lender generally needs to file a UCC-1 financing statement to protect its priority against other creditors.
The payee can declare the remaining balance immediately due (if the note includes an acceleration clause) and can sue to collect. Since all powers of attorney to confess judgment are void under Florida Statute Section 55.05, the payee cannot get a judgment without filing a lawsuit.
Generally 5 years from a missed payment or the note's stated due date, under Florida's statute of limitations for actions on a written contract (Fla. Stat. Section 95.11(2)(b)). Waiting too long can mean losing the right to sue on the note.
Yes. Promissory notes are commonly used for both family loans and business or LLC loans in Florida. The same usury cap and other rules generally apply, so keep the stated interest rate within the 18% civil cap and well clear of the 25% criminal usury threshold regardless of who the parties are.