Idaho Unsecured Promissory Note Overview
An unsecured promissory note in Idaho 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 Idaho is No cap (market rate).
No usury cap for most transactions; parties may agree to any rate. Unsecured notes carry more risk for the lender, so interest rates are typically higher than secured notes. However, the rate must still comply with Idaho's usury laws.
If the borrower defaults, the lender's primary remedy is filing a lawsuit within Idaho's statute of limitations (4 years (oral), 5 years (written)). The small claims court limit in Idaho is $5,000, which is ideal for smaller unsecured loans.
No cap (market rate)
Usury rate cap
4 years
Statute of limitations
$5,000
Small claims limit
25%
Max garnishment
Idaho Legal Requirements
Idaho has specific requirements for unsecured promissory notes:
Important: Idaho Usury Laws
Idaho's maximum interest rate is No cap (market rate). No usury cap for most transactions; parties may agree to any rate. 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 Idaho's No cap (market rate) 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 Idaho law as the governing jurisdiction
Collection Remedies in Idaho
If a borrower defaults on an unsecured promissory note in Idaho, 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 ($5,000 limit)
Fast, affordable, no attorney required for amounts within the limit
File a Civil Lawsuit
For amounts above small claims limits, file in Idaho civil court
Enforce the Judgment
Up to 25% of disposable earnings. Bank account levies and property liens also available
Statute of Limitations in Idaho
The statute of limitations for collecting on a promissory note in Idaho is 4 years (oral), 5 years (written). After this period, the lender loses the right to file a lawsuit to enforce the note.
| Aspect | Idaho Rule |
|---|---|
| Usury Rate | No cap (market rate) |
| Statute of Limitations | 4 years (oral), 5 years (written) |
| Small Claims Limit | $5,000 |
| Garnishment Rules | Up to 25% of disposable earnings |
Sample Idaho Unsecured Promissory Note
Below is a preview of our Idaho-specific unsecured promissory note template.
STATE OF IDAHO
UNSECURED PROMISSORY NOTE
No Collateral Loan Agreement
LENDER:
Name: [Lender Name]
Address: [Idaho Address]
BORROWER:
Name: [Borrower Name]
Address: [Idaho Address]
LOAN TERMS
Principal: $[Amount]
Interest: [Rate]% per annum (max No cap (market rate) in ID)
This note is UNSECURED. No collateral has been pledged.
Idaho Unsecured Promissory Note FAQ
Answers to common questions about unsecured promissory notes and collection procedures in Idaho.
Official Idaho Resources
Use these official resources for Idaho lending laws and court procedures.
Other Idaho Promissory Note Types
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