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A South Carolina promissory note is a written agreement wherein a lender agrees to grant a borrower a loan to be repaid with interest by a specified date. Essential information such as how much money is borrowed, the annual interest, repayment terms, and what should happen in the event of default should all be outlined in this document.
In the event that the borrower defaults on the agreement, they risk losing any collateral that may have been used as “security” in the form. South Carolina has a statute of limitations of three (3) years in which a lender may sue a borrower to collect unpaid dues.
Types (2)
Secured Promissory Note – Borrowers must provide “security” by putting up collateral to receive a loan with this agreement.
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Unsecured Promissory Note – A financing agreement that does not require the borrower to provide collateral.
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Laws
- Interest & Usury Laws: Title 34, Chapter 31 – Money and Interest & Title 37, Chapter 3, Loans
- Usury Rate in General (§ 34-31-20(A)): 8.75%
- Usury Rate for Unsupervised Loans (§ 37-3-201(1)): 12%
- Usury Rate for Supervised Loans (§ 37-3-201(2)(c)): 18%
- Usury Rate for Monetary Judgments (§ 34-31-20(B)): For each year damages are rewarded, interest will be calculated with the prime rate listed in the first Wall Street Journal published for each calendar year plus 4%, compounded annually. For older judgments, interest will be calculated as follows:
- 14% a year for judgments entered before January 1, 2001
- 12% a year for judgments entered between January 1, 2001, and June 30, 2005