Rhode Island Demand Promissory Note Overview
A demand promissory note in Rhode Island 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 Rhode Island is 21%.
21% max; alternative rate of 9% above domestic prime. Demand notes are commonly used in Rhode Island for family loans, loans between friends, shareholder loans, and informal business financing where both parties want flexibility.
Regarding demand notice in Rhode Island: No specific period; reasonable demand required. The statute of limitations for collecting on a promissory note in Rhode Island is 10 years (oral and written), though the start date for demand notes can vary.
21%
Usury rate cap
On Demand
No fixed maturity
10 years
Statute of limitations
30 Days
Recommended notice
Rhode Island Legal Requirements
Rhode Island has specific requirements for demand promissory notes:
Important: Rhode Island Usury & Demand Rules
Rhode Island's maximum interest rate is 21%. No specific period; reasonable demand required. 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 Rhode Island's 21% usury cap
- Delivery Method: Specify how demand must be delivered (certified mail recommended)
- Governing Law: Specify Rhode Island as the governing jurisdiction
Making a Demand in Rhode Island
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 Rhode Island 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 small claims or superior court
Collection Procedures in Rhode Island
If the borrower fails to pay after a proper demand, the lender can pursue legal remedies in Rhode Island.
| Aspect | Rhode Island Rule |
|---|---|
| Usury Rate | 21% |
| Demand Notice | No specific period; reasonable demand required |
| Statute of Limitations | 10 years (oral and written) |
| Collection Procedure | Demand letter, suit in small claims or superior court |
Sample Rhode Island Demand Promissory Note
Below is a preview of our Rhode Island-specific demand promissory note template.
STATE OF RHODE ISLAND
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: [Rhode Island Address]
BORROWER:
Name: [Borrower Name]
Address: [Rhode Island Address]
TERMS
Interest: [Rate]% per annum (max 21% in RI)
Payable within 30 days of written demand by Lender
Rhode Island Demand Promissory Note FAQ
Answers to common questions about demand promissory notes in Rhode Island.
Official Rhode Island Resources
Official resources for Rhode Island lending laws and court procedures.
Other Rhode Island Promissory Note Types
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