Installment Note with Single Schedule for Repayment of Principal and Interest Combined (Individual Borrower)
Summary
This template is an installment note that provides for a single schedule for the repayment of principal and interest at the same time, and is for use when the borrower is an individual. This template includes practical guidance and drafting notes. This note, a common type of installment note used for commercial purposes, calls for equal scheduled payments combining principal and interest. This arrangement is based on the principle of a straight amortized loan, in which the installment payments remain the same, and since (true) interest owing is higher at the beginning than at the end of the loan when less principal is outstanding, the ratio of principal to interest is different for each payment. However, at maturity there may yet remain a large principal balance to be paid. The size of the payment must be computed so that an adequate amount of principal is repaid in each earlier installment so as to allow either for complete pay off by the last installment, or a manageable figure of ...