Georgia Unsecured Promissory Note Overview
An unsecured promissory note in Georgia is a loan agreement where the borrower promises to repay without pledging any collateral. The lender relies on the borrower's creditworthiness and the legally enforceable promise to pay. The maximum interest rate in Georgia is 7% (default).
7% default rate; 5% per month (60% per annum) maximum by written contract; special rules for loans over $3,000. Unsecured notes carry more risk for the lender, so interest rates are typically higher than secured notes. However, the rate must still comply with Georgia's usury laws.
If the borrower defaults, the lender's primary remedy is filing a lawsuit within Georgia's statute of limitations (4 years (oral), 6 years (written)). The small claims court limit in Georgia is $15,000, which is ideal for smaller unsecured loans.
7% (default)
Usury rate cap
4 years
Statute of limitations
$15,000
Small claims limit
25%
Max garnishment
Georgia Legal Requirements
Georgia has specific requirements for unsecured promissory notes:
Important: Georgia Usury Laws
Georgia's maximum interest rate is 7% (default). 7% default rate; 5% per month (60% per annum) maximum by written contract; special rules for loans over $3,000. Exceeding this limit may void the interest or result in penalties.
- Written Agreement: Must be in writing, signed by borrower, clearly stating loan terms
- Compliant Interest Rate: Must not exceed Georgia's 7% (default) usury cap
- No Collateral Statement: Explicitly state that the note is unsecured with no collateral pledged
- Default Provisions: Events of default, cure period, acceleration clause, and collection remedies
- Personal Guarantee: Recommended for business borrowers to protect the lender
- Governing Law: Specify Georgia law as the governing jurisdiction
Collection Remedies in Georgia
If a borrower defaults on an unsecured promissory note in Georgia, the lender has several collection options:
Send a Formal Demand Letter
Written notice demanding payment within a specified timeframe, creating a paper trail
File in Small Claims Court ($15,000 limit)
Fast, affordable, no attorney required for amounts within the limit
File a Civil Lawsuit
For amounts above small claims limits, file in Georgia civil court
Enforce the Judgment
Up to 25% of disposable earnings. Bank account levies and property liens also available
Statute of Limitations in Georgia
The statute of limitations for collecting on a promissory note in Georgia is 4 years (oral), 6 years (written). After this period, the lender loses the right to file a lawsuit to enforce the note.
| Aspect | Georgia Rule |
|---|---|
| Usury Rate | 7% (default) |
| Statute of Limitations | 4 years (oral), 6 years (written) |
| Small Claims Limit | $15,000 |
| Garnishment Rules | Up to 25% of disposable earnings |
Sample Georgia Unsecured Promissory Note
Below is a preview of our Georgia-specific unsecured promissory note template.
STATE OF GEORGIA
UNSECURED PROMISSORY NOTE
No Collateral Loan Agreement
LENDER:
Name: [Lender Name]
Address: [Georgia Address]
BORROWER:
Name: [Borrower Name]
Address: [Georgia Address]
LOAN TERMS
Principal: $[Amount]
Interest: [Rate]% per annum (max 7% (default) in GA)
This note is UNSECURED. No collateral has been pledged.
Georgia Unsecured Promissory Note FAQ
Answers to common questions about unsecured promissory notes and collection procedures in Georgia.
Official Georgia Resources
Use these official resources for Georgia lending laws and court procedures.
Other Georgia Promissory Note Types
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