Sample promissory note for delayed payments

From time to time, we go to credit companies and banks for requesting a loan. This process can take some time because the bank first verifies that the applicant has good financial value and has enough assets to return the loan payment with interest rate and then the documentation starts, approvals are gathered from various departments, and then the loan amount is transferred to the applicant. Before accepting the loan payment, the individual signs an agreement with the bank where all the terms and conditions are written including the interest rate, monthly installments, and duration to return the loan. In case the loan is not returned and the bank wants to foreclose the pledged asset, the individual can write a promissory note for delayed payment to the bank. This is a simple document where the individual explains his or her situation and promises to pay the loan in near future.

Importance of Promissory Note for Delayed Payments:

There can be many reasons for asking for a loan. For instance, an individual can ask for a loan to pay for his studies while another person can ask for a loan to pay for medical expenses, to buy a car, to rent an apartment, or to aid a bankrupt business. No matter what the reason is, some specific terms and conditions are discussed with each applicant before their loan request is approved. One of the common reasons for writing these terms and conditions is that if the individual fails or denies repaying the loan, the bank has the right to seize the pledged property or item i.e. jewelry, stocks, shares, etc., and sell them through auction to recover their amount.

If such a situation occurs, the individual has no right or control over the circumstances and he can either pay the loan back to the bank or watch his property being auctioned away for recovery. Taking legal action in this situation is never the right choice or a possibility. Instead, writing a promissory note to the bank, explaining your situation, and requesting them to give you some more time to pay back the loan amount can result in better handling of these situations. In this promissory note for delayed payment, the applicant strikes the human side of the bank by showing real emotions and requesting them to show some kindness and allow more time to repay the loan.

Key Elements to include in Promissory Note for Delayed Payments:

  • Name of the recipient of the letter
  • Date of writing the letter
  • Subject of the letter
  • formal introduction of the person writing the letter
  • Explanation of the loan agreement, capital amount, interest rate
  • Pending amount of the loan
  • Particular circumstances that caused the delay in the payment
  • Expected timeline to repay the loan
  • Formal request to extend loan limit/duration before foreclosing

Sample Promissory Note for Delayed Payments


Mr. Adam Smith

Manager FWO

Commercial Bank Ltd

West Downtown Area

Washington DC

Date: 18th December 2021


Subject: promissory note for delayed payment


Dear Mr. Smith,

I hope you are in good health. I am writing this letter in response to the late payment notice I received from your bank 2 days ago. With this letter, I am formally requesting you to extend my credit period and that I will make the balance payment as soon as possible.

I took a loan of $500,000 from your bank at a fixed interest rate of 7.2% for 2 years. In the agreement, I agreed that if I fail to pay back the loan within the next 2 years, I will comply with the interest rate of 9% for the 3rd year. If I fail to completely return the capital amount with the interest gain within 4th year, the bank has every right to seize my pledged property and auction it.

It’s already been 4 years and I am sorry to say that I haven’t paid the loan to you yet. There is still the capital amount of $50,000 that is unpaid along with $23,000 in interest. I am not saying that I won’t be able to pay it back but I am just asking for a little more time from your side before you sell my home in the auction to recover your amount.

You know it very well that last year and the year before that wasn’t good for businesses because of the pandemic and overall failed financial situations of the businesses. I am running my company for the past 15 years and I never had to fire an employee because of money issues. Last year because of COVID19, I had to fire 3 of the employees, and overall decreased sales hugely affected my profit margin.

I have a very good and long relationship with your bank and I never defaulted on any payment let alone delaying or not paying it at all. For the sake of our past together, I am requesting you to reconsider your request of foreclosing my residence and allow me 2-3 months to make the loan payments. Because this is a problem from my end, I am willing to pay an interest rate of 12% for the remaining amount of the capital figure. The pandemic is almost over and the sales have started to increase since last week and I am very positive that the whole situation will be in my control within the next 4-5 weeks.

I hope to hear good news from you very soon.



Joshua Sestina


Oregon Pharmaceutical Pvt Ltd

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