Sample Promissory Note

PROMISSORY NOTE
(This is a Balloon Note)

Date:

The undersigned promises to pay to (Name of Lender) of or order, the sum of
($ ) in lawful money of the United States of America at the home office of said with interest thereon from date at the rate of Percent ( %) per annum until paid. Said principal and interest is payable at or at such other place as the Lender may designate, in ( ) consecutive monthly installments of ($ ) on the day of each month beginning on the day of , 20 and one final balloon payment of ($ ), which balloon payment shall be due and payable on the day of , 20. The monthly principal and interest payments shall be based on a ( ) year amortization. Each monthly installment shall be applied first to interest then due, and the remainder to principal, which monthly installments and balloon payment the undersigned, promises to pay as they fall due. NOTE: The full balance of all unpaid principal and interest hereunder shall be due and payable on the day of , 20 if not sooner paid.

It is agreed that in the event default is made in the payment of this Note at maturity, or of any installment thereof, whether maturing by expiration of time, by default as herein provided, or as provided in the Deed of Trust given in security hereof, and same is placed in the hands of an attorney for collection, then an additional amount of Percent ( %) on the principal and interest of this Note shall be added to the same as a collection fee, and the failure to pay any installment when due shall mature the entire indebtedness at the option of the holder of this Note.

Privilege is reserved to make payments on the principal in addition to the regular monthly installments on any installment date by paying a Percent (%) prepayment penalty on such excess during the first year of this loan, which prepayment penalty shall be reduced each year thereafter at the rate of Percent (%) per year, but never below %. The Note holder may require that any partial prepayments (i) be made on the date monthly installments are due, and (ii) be in the amount of that part of one or more monthly installments which would be applicable to principal. Any partial prepayment shall be applied against the principal amount outstanding in the inverse order of due dates and shall not postpone the due date of any subsequent monthly installments or change the amount of such installments unless the Note holder shall otherwise agree in writing.

The makers, signers, drawers, guarantors, sureties and endorsers hereof severally waive presentation for payment, demand, protest, diligence in collecting, and notice of dishonor, notice of extension of time, notice of protest, and notice of nonpayment of this Note. Any notice to the undersigned Maker provided for in this Note shall be given by mailing such notice by first-class mail addressed to the said Maker at (Address of Maker), or to such other address as the Maker may designate by notice to the Note holder at the home office of said Note holder, or at such other place as the Note holder may designate.

It is the intention of the undersigned and the Note holder to conform strictly to applicable usury laws. Accordingly, if the transactions contemplated hereby would be usurious under applicable law (including the laws of the State of and/or the laws of the United States of America, whichever would apply and allow the higher rate), then, in that event, notwithstanding anything to the contrary herein or in any agreement entered into in connection with or as security for this Note, it is agreed as follows: (i) the aggregate of all consideration which constitutes finance charges under applicable law that is taken, reserved, contracted for, charged or received under this Note or under any agreement securing this Note or otherwise in connection with this Note, shall under no circumstances exceed the maximum finance charges which the undersigned may contract for and agree to pay and the holder may receive under applicable law, and any excess shall be credited on principal by the holder hereof (or, if this Note shall have been paid in full, refunded to the undersigned); and (ii) in the event that maturity of this Note is accelerated by reason of an election by the holder hereof resulting from any default hereunder or otherwise, or in the event of any required or permitted prepayment, then such consideration that constitutes finance charges may never include more than the maximum amount allowed as aforesaid by applicable law, and any excess finance charges, if any, provided for in this Note or otherwise shall be canceled automatically as of the date of such acceleration or prepayment, and, if theretofore prepaid, shall be credited on principal (or if this Note shall have been paid in full, refunded to the undersigned).

This Note is secured by a Deed of Trust executed this day by the Maker hereon on real estate situated in County, for description of which property, see said Deed of Trust.

IN WITNESS WHEREOF, Maker has executed this Note as of the date first above written.

Signature of Maker

Signature of Maker