Promissory Notes

Promissory Notes

by Deb Scott

​When you borrow money, you usually sign a promissory note. What do you think a promissory note is?

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​What are some things you might use a promissory note for?

​When you borrow money, in addition to paying back what you borrow, you need to pay back extra. Does anyone know what that extra amount you pay back called?

​Lenders may make you put something as collateral when you borrow money.

​Some lenders have a Home Equity Loan. Home Equity is the difference between what the home could be sold for and what is owed on it.

Open Ended

What do you think might happen is a loan is not payed pack.

​I = PRT

​I ---- Interest ( extra to pay back)

​P ---- Principal ($ borrowed)

​R ----Rate (percent)

​T----Time (years)

Multiple Choice

Write 67% as a decimal

• 67

• 6.7

• 0.67

• 0.067

Multiple Choice

Write 2.5% as a decimal

• 2.5

• 0.25

• 0.025

• 25

Multiple Choice

Find 4% of $3,500

• $140

• $150

• $130

• $145

Multiple Choice

Find 6.5% of $6,340

• $415

• $427.35

• $412.10

• $410.38

Multiple Choice

$300 x 2% x 1/2

• $40

• $30

• $50

• $25

Multiple Choice

Find $5000 x 4% x 1/4

• $30

• $40

• $50

• $60

Multiple Choice

$7,520 x 6.2% x 1 1/2

• $725.36

• $700

• $699.36

• $698.24

Fill in the Blanks

On May 8, 2021, Jane borrowed $6,500 from her bank to buy a boat, on which she used as collateral for the loan. Jane signed a 2-year promissory note at a 10% interest rate. Find the amount of interest, she must pay.

Fill in the Blanks

On May 8, 2021, Jane borrowed $6,500 from her bank to buy a boat, on which she used as collateral for the loan. Jane signed a 2-year promissory note at a 10% interest rate. Find the total amount she must repay

Fill in the Blanks

Robert borrowed $3500 for 18 months from his bank to have his house repainted. He signed a promissory note that carried 12% interest. Find the amount of interest Robert must pay.

Fill in the Blanks

Robert borrowed $3500 for 18 months from his bank to have his house repainted. He signed a promissory note that carried 12% interest. Find the total amount he must repay his bank on the due date.