Free Missouri Promissory Note Template

A Missouri promissory note is a signed, written promise to repay money on set terms. Missouri sets its written ceiling at ten percent, though a published market rate can lift it when government bond yields run higher.

Chapter 408 of the Revised Statutes of Missouri covers legal tender and interest. Two sections set the rates for a private note.

9% Without an Agreed Rate

Under § 408.020, creditors may receive interest at nine percent a year when no other rate is agreed. That covers money after it becomes due and payable on written contracts. It also reaches money recovered for another’s use and kept without the owner’s knowledge. Other money owed counts too, if an express promise to pay interest was made.

10%, or the Market Rate

Section 408.030(1) governs what the parties may agree. They may contract in writing for a rate not exceeding ten percent a year on money due or to become due under any contract. However, when the “market rate” exceeds ten percent, they may instead agree in writing to a rate up to that market rate.

The statute defines the benchmark. For any calendar quarter, the market rate tracks the monthly index of long-term United States government bond yields. The figure comes from the second calendar month before the quarter begins.

Commitments Are Fixed to Their Date

Loan commitments come next in the same subsection. So a contract for commitment to lend money cannot exceed the maximum lawful rate in effect on the date of that contract. A loan made under a valid commitment then cannot exceed the maximum lawful rate in effect on the commitment date.

Notes Sold to a Bank

Subsection 408.030(4) covers the sale of a note. A bank, trust company, or savings and loan association may purchase any note, bill of exchange, or other evidence of debt. That holds whether it is payable in installments or otherwise, at a price the parties agree.

Other Sections in the Chapter

Meanwhile, several nearby sections in Chapter 408 bear on notes, judging by their titles in the Revisor’s index:

• § 408.050, excess interest paid recoverable with costs and attorney fee
• § 408.070, usurious interest and the invalidity of a security agreement
• § 408.080, interest on interest, with compounding limited to once a month
• § 408.095, charging more than two percent a month as a misdemeanor, with exceptions
• § 408.175, the interest rate when maturity of a note or contract is accelerated

Ten percent a year, or the market rate if it’s higher. Both figures depend on a written agreement, so the note itself is what fixes the rate.

Because the market rate moves each quarter, the date matters. Work from the figure in force when you sign, and keep a note of what it was.

Charging past the ceiling carries consequences elsewhere in the chapter. Those include a borrower’s recovery of excess interest with costs and an attorney fee, plus a criminal provision above two percent a month. Before pricing a loan near the limit, check those sections or ask a Missouri attorney.

Tip: Interest on overdue interest is allowed, but § 408.080’s title limits compounding to once a month. So state plainly how interest accrues in your Missouri promissory note.

Fix the rate against the right date. Work through these steps:

1. Check whether the market rate exceeds ten percent for the quarter you’re in.
2. Choose an annual rate at or below the applicable ceiling.
3. Write the rate into the note, since both ceilings require a written agreement.
4. Set out how interest accrues, including any compounding.
5. Have the borrower and any cosigner sign, and date the note.
6. Give each party a copy, and keep a record of every payment.

The usual terms apply, with the signing date carrying extra weight.

• Lender and borrower names and addresses
• Principal amount
• Annual interest rate, in writing
• Date of signing, and the ceiling you relied on
• How interest accrues and whether it compounds
• Payment schedule and due date
• Acceleration and default terms
• Collateral, if secured
• Signatures and dates

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