Arkansas Demand Promissory Note Overview
A demand promissory note in Arkansas is a flexible loan agreement where the lender can request full repayment at any time. There is no fixed maturity date — the loan remains outstanding until the lender makes a formal demand. The maximum interest rate in Arkansas is 17%.
Maximum 17% per annum; constitutional cap. Demand notes are commonly used in Arkansas for family loans, loans between friends, shareholder loans, and informal business financing where both parties want flexibility.
Regarding demand notice in Arkansas: Reasonable notice required by common law. The statute of limitations for collecting on a promissory note in Arkansas is 5 years (oral and written), though the start date for demand notes can vary.
17%
Usury rate cap
On Demand
No fixed maturity
5 years
Statute of limitations
30 Days
Recommended notice
Arkansas Legal Requirements
Arkansas has specific requirements for demand promissory notes:
Important: Arkansas Usury & Demand Rules
Arkansas's maximum interest rate is 17%. Reasonable notice required by common law. Specify a clear notice period in your note to avoid disputes.
- Written Agreement: Must be in writing and signed by the borrower
- Demand Clause: Clearly state the note is “payable on demand”
- Notice Period: Specify days borrower has to pay after written demand (30-90 days recommended)
- Compliant Interest Rate: Must not exceed Arkansas's 17% usury cap
- Delivery Method: Specify how demand must be delivered (certified mail recommended)
- Governing Law: Specify Arkansas as the governing jurisdiction
Making a Demand in Arkansas
When the lender is ready to call in the loan, they must follow proper demand procedures:
Prepare the Demand Letter
State the total amount owed (principal + accrued interest), reference the original note, and specify the deadline for payment
Send via Certified Mail
Send the demand letter by certified mail with return receipt to prove delivery under Arkansas law
Wait the Notice Period
Allow the borrower the full notice period specified in the note (or a reasonable time if not specified) to arrange payment
Pursue Collection if Unpaid
Demand letter, suit in circuit or district court
Collection Procedures in Arkansas
If the borrower fails to pay after a proper demand, the lender can pursue legal remedies in Arkansas.
| Aspect | Arkansas Rule |
|---|---|
| Usury Rate | 17% |
| Demand Notice | Reasonable notice required by common law |
| Statute of Limitations | 5 years (oral and written) |
| Collection Procedure | Demand letter, suit in circuit or district court |
Sample Arkansas Demand Promissory Note
Below is a preview of our Arkansas-specific demand promissory note template.
STATE OF ARKANSAS
DEMAND PROMISSORY NOTE
Payable on Demand — No Fixed Maturity
FOR VALUE RECEIVED, the undersigned promises to pay ON DEMAND to the order of Lender the sum of $[Amount]
LENDER:
Name: [Lender Name]
Address: [Arkansas Address]
BORROWER:
Name: [Borrower Name]
Address: [Arkansas Address]
TERMS
Interest: [Rate]% per annum (max 17% in AR)
Payable within 30 days of written demand by Lender
Arkansas Demand Promissory Note FAQ
Answers to common questions about demand promissory notes in Arkansas.
Official Arkansas Resources
Official resources for Arkansas lending laws and court procedures.
Other Arkansas Promissory Note Types
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