West Virginia Promissory Note
West Virginia promissory note template with the 8% usury cap and 10-year statute of limitations under state law. Free template. Attorney review available.
Introduction
West Virginia's usury cap disappears entirely for a business-purpose debt owed by a business entity, regardless of size, but a natural person only gets that exemption at $20,000 principal or more. Below that line, a written note is capped at 8% per year, or 6% by default without a written rate. Charge more and the penalty is explicit: the note is void as to all interest, and the borrower can recover four times the interest agreed to be paid, with a $100 minimum. A promissory note is a written, signed promise by one party, the maker, to pay a definite sum to another, the payee, on demand or by a set date, the paper trail behind a family or business loan. A West Virginia note doesn't need to be notarized or witnessed to be enforceable. Confession-of-judgment clauses, letting a payee get judgment against the maker without a lawsuit, are void in a "consumer loan," a term West Virginia defines narrowly: a lender regularly engaged in the business of making loans, for a personal, family, household, or agricultural purpose, $45,000 or less unless land-secured. Outside that definition, the Commercial Code lists such a clause as one a note can carry without losing negotiable-instrument status. You generally have 10 years from a missed payment or the note's due date to sue to collect.
0/5000
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
West Virginia caps interest on a written promissory note at 8% per year (6% per year by default if no written rate is stated). A debt incurred primarily for a business purpose is exempt from the cap entirely if owed by a business entity, or, if owed by a natural person, exempt once the principal reaches $20,000. (W. Va. Code Section 47-6-5; Section 47-6-11)
- 3
Charging more than the lawful rate (usury) has a stated penalty in West Virginia: the note becomes void as to all interest, and the borrower may recover four times the interest agreed to be paid, with a $100 minimum. (W. Va. Code Section 47-6-6)
- 4
A West Virginia promissory note does not need to be notarized or witnessed to be enforceable. West Virginia's Commercial Code Section 46-3-104 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 a "consumer loan," defined as a loan by a lender regularly engaged in the business of making loans, for a personal, family, household, or agricultural purpose, of $45,000 or less unless secured by land. Outside that definition, the Commercial Code lists a confession-of-judgment authorization as a clause a note can carry without losing negotiability. (W. Va. Code Section 46A-2-117; Section 46-3-104(a)(3)(ii))
- 6
You generally have 10 years from a missed payment or the note's stated due date to sue to collect on a written, signed promissory note in West Virginia. (W. Va. Code Section 55-2-6)
- 7
If a West Virginia 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. Promissory notes are commonly used for both family loans and business loans in West Virginia. (W. Va. Code Section 46-9-310)
Key decisions before you file
Before you file a Promissory Note in West Virginia, a few decisions shape the document: which option to choose and what each one means. The Promissory Note guide walks through them.
Open the Promissory Note guideCustomize your Promissory Note Template with DocDraft
Once your Promissory Note is ready, you can check whether it needs to be notarized in West Virginia in about a minute, and notarize it online through DocDraft if it does.
West Virginia Requirements for Promissory Note
Notarization Not Required for Validity (West Virginia Code Section 46-3-104)
West Virginia does not require a promissory note to be notarized or witnessed to be enforceable. Commercial Code Section 46-3-104'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.
Maximum Legal Interest Rate (West Virginia Code Section 47-6-5)
For a written promissory note, the maximum is 8% per annum. Absent a written rate, the default statutory rate is 6% per annum. A business-purpose debt owed by a business entity is exempt from the cap entirely; a business-purpose debt owed by a natural person is exempt once the principal reaches $20,000.
Usury Penalty for Exceeding the Interest Rate Cap (West Virginia Code Section 47-6-6)
A contract charging more than the lawful rate of interest is void as to all interest, and the borrower may recover from the lender an amount equal to four times all interest agreed to be paid, with a minimum recovery of $100. A usurious contract is presumed willfully made, but a bona fide error corrected within 15 days of notice is not a violation.
Negotiable Instrument Requirements (West Virginia Code Section 46-3-104)
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.
Confession of Judgment Void for Consumer Loans (West Virginia Code Section 46A-2-117)
A confession-of-judgment authorization is void in a "consumer loan," "consumer credit sale," or "consumer lease" as those terms are defined by the West Virginia Consumer Credit and Protection Act. Outside that defined scope, the Commercial Code lists a confession-of-judgment authorization as a clause a note may carry without losing its status as a negotiable instrument (Section 46-3-104(a)(3)(ii)).
Statute of Limitations (West Virginia Code Section 55-2-6)
Generally 10 years from a missed payment or the note's stated due date to sue to collect on a written contract signed by the party to be charged.
Secured Transaction Filing (West Virginia Code Section 46-9-310)
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.
Business-Purpose Debt Exemption From the Usury Cap (West Virginia Code Section 47-6-11)
No interest-rate limit or usury penalty applies to a debt incurred primarily for a business purpose, or to a refinancing of such a debt. If the debt is incurred by a natural person rather than a business entity, this exemption applies only once the debt's principal amount is $20,000 or more.
Does your Promissory Note need to be notarized in West Virginia?
Whether a Promissory Note needs to be notarized depends on your state. Upload yours, pick your state, and get the current rule with the official source behind it, free and with no account. If yours does need a notary, online notarization is part of your DocDraft plan.
Check my Promissory Note