Free Louisiana Promissory Note Template

A Louisiana promissory note is a signed, written promise to repay money on stated terms. Louisiana caps conventional interest at twelve percent a year. It also insists the rate be fixed in writing, since testimony alone cannot prove it.

R.S. 9:3500 divides interest into legal and conventional. Conventional interest is what the parties agree, and most of the section deals with it.

The 12% Cap, in Writing

Under subsection C(1), the amount of conventional interest cannot exceed twelve percent per annum. The same rate must be fixed in writing. As the statute puts it, testimonial proof of the rate is not admitted in any case.

Recovering What Was Overpaid

Subsection C(2) gives the payer a remedy. Someone who paid a higher rate than the law allows, whether as discount or otherwise, may sue for it and recover it. That action must come within two years from the time of the payment.

A Note Above the Cap Is Still Collectible

However, subsection C(4)(a) protects the holder rather than voiding the note. The owner of a promissory note may collect the whole amount even though the note includes a rate above twelve percent. From maturity onward, though, the obligation cannot bear more than twelve percent a year until it is paid.

Two limits sit next to that rule. First, paragraph (b) says it doesn’t apply to a consumer credit transaction under the Louisiana Consumer Credit Law. Then paragraph (c) lets a defendant show usury by any competent evidence, where usury is a defense to a suit on a note.

Business Loans Sit Outside the Article

Meanwhile, subsection D removes commercial lending from these provisions. It covers a loan made for commercial or business purposes, and also deferring payment of an obligation for those purposes.

Judicial Interest

Finally, subsection B(1) handles sums that become the object of a judicial demand. Interest there runs at the rate fixed in R.S. 13:4202, which is why it’s called judicial interest.

Twelve percent a year, for a conventional loan. So that ceiling reaches private lending, as long as it isn’t for business or commercial purposes.

Going over it carries an odd mix of consequences. The note itself stays collectible in full, so the lender doesn’t lose the principal. However, interest after maturity drops to twelve percent, and the borrower can claw back the excess for two years after paying it.

For that reason, the written rate is where the care belongs. Set it at or below twelve percent, and write it into the note rather than relying on an understanding.

Tip: An oral side agreement on interest is worth nothing here. Because testimonial proof isn’t admitted, the figure in your Louisiana promissory note is the only one that counts.

The writing carries all the weight, so build it carefully. Follow these steps:

1. Decide whether the loan is for business or personal purposes.
2. For a personal loan, choose an annual rate at or below twelve percent.
3. Write that rate into the note as a number, never as an understanding.
4. Set the maturity date, since interest after maturity is capped separately.
5. Have the borrower and any guarantor sign, and date the note.
6. Give each party a copy, and keep a record of every payment.

Here too, the usual terms apply, with the rate and the maturity date carrying extra weight.

• Lender and borrower names and addresses
• Principal amount
• Annual interest rate, fixed in writing
• Loan purpose, business or personal
• Payment schedule and maturity date
• Interest rate after maturity
• Default terms
• Collateral, if secured
• Signatures and dates

Document Genius’s guided form walks you through each term, so your Louisiana promissory note template is ready to download or e-sign in minutes.