Best Examples of Promissory Note Templates with a Co-Signer

Real examples of promissory note examples with co-signer in everyday life

Before definitions and theory, it helps to see how people actually use co-signed notes. When lawyers talk about examples of promissory note examples with co-signer provisions, they’re usually thinking about situations like these:

• A parent co-signs a personal loan so their adult child can consolidate credit card debt.
• A business partner co-signs a startup loan from a friend.
• A spouse co-signs a home renovation loan from a family member.
• A mentor co-signs a small business note to help a protégé qualify with a bank.

All of these are real examples of the same basic structure: the borrower promises to pay, and the co-signer promises, in writing, to be just as responsible if the borrower doesn’t.

Example of a simple personal loan promissory note with co-signer

Imagine this situation: Jordan borrows $8,000 from Taylor to pay off high-interest credit cards. Jordan’s credit history is shaky, so Taylor insists on a co-signer, Alex.

A very simple example of promissory note language with a co-signer might read like this (heavily simplified for clarity):

Borrower: Jordan Smith, 123 Main Street, Anytown, NY 10001
Lender: Taylor Johnson, 456 Oak Avenue, Anytown, NY 10001
Co-Signer (Guarantor): Alex Rivera, 789 Pine Road, Anytown, NY 10001
Principal Amount: $8,000
Interest Rate: 7% per year, fixed
Repayment: 24 equal monthly payments of $358.27 due on the 1st of each month, beginning March 1, 2025.
Late Charge: $25 if payment is more than 10 days late.
Co-Signer’s Promise: Co-Signer unconditionally guarantees payment and performance of all Borrower’s obligations under this Note. Lender may collect from Borrower, Co-Signer, or both, without first attempting to collect from Borrower.

This is one of the best examples to illustrate the core idea: the co-signer’s promise is unconditional, and the lender can go straight to the co-signer if the borrower misses payments.

Business-focused examples of promissory note examples with co-signer

Example: Co-signed small business startup loan

Consider a startup: Lina is launching a small graphic design studio. Her friend Marco lends $20,000. Because the business is brand new and risky, Marco wants Lina’s spouse, Chris, to co-sign.

The note might add language like:

Purpose of Loan: Working capital for Lina Design Studio LLC.
Borrower: Lina Design Studio LLC, by Lina Gomez, Managing Member.
Co-Signer: Chris Gomez, individually.
Co-Signer Liability: Co-Signer agrees to be jointly and severally liable with Borrower for all amounts due under this Note, including principal, interest, fees, and costs of collection.

“Jointly and severally liable” is the phrase that matters. It means the lender can pursue either the business, the owner, or the co-signer—or all of them—for the full balance. When lawyers give examples of promissory note examples with co-signer in a business context, this is the exact phrase they look for.

Example: Investor-backed bridge loan with a co-signer

Now picture a short-term “bridge” loan. A small company needs $50,000 for three months while waiting for a big client payment. An angel investor agrees to lend the money only if the CEO personally co-signs.

Key features in this real-world style example:

• Short term (90–120 days)
• Higher interest rate (say, 12–15% annualized)
• Personal co-signer with stronger credit
• Clear default triggers tied to date and non-payment

The note might say:

Default: Failure to pay any amount due within 5 days after the due date constitutes a default. Upon default, the entire unpaid principal and accrued interest become immediately due and payable at Lender’s option.

For the co-signer, this is risky: default by the company instantly becomes a personal problem. That’s why regulators like the Consumer Financial Protection Bureau (CFPB) warn co-signers to read these terms carefully before signing. You can see their guidance on co-signing risks here: https://www.consumerfinance.gov/ask-cfpb/what-do-i-need-to-know-if-someone-asks-me-to-co-sign-a-loan-en-805/

Family loan examples of promissory note examples with co-signer

Money between family members is where things often go sideways. Putting the agreement in writing—and adding a co-signer when appropriate—can save relationships.

Example: Parent-to-child car loan with grandparent as co-signer

Scenario: A parent lends $6,000 to help their 19-year-old buy a used car. The grandparent agrees to co-sign because the teen has no credit history.

Key elements:

• Clear repayment schedule (for example, $250 per month for 24 months)
• Interest rate at or above the IRS Applicable Federal Rate (AFR) to avoid tax issues on “below-market” loans
• Co-signer liability spelled out in plain English

A plain-language co-signer clause might say:

Co-Signer’s Agreement: Grandparent agrees to be responsible for this debt if Borrower does not pay. Lender may demand payment from Borrower, Co-Signer, or both. Co-Signer understands that late payments or non-payment may appear on Co-Signer’s credit report and may affect Co-Signer’s ability to obtain credit.

This type of example lines up with tax and lending guidance you’ll find from the IRS and consumer agencies. The IRS publishes AFR rates here: https://www.irs.gov/applicable-federal-rates

Example: Student support loan between relatives with a sibling co-signer

Another common example of a co-signed promissory note: an aunt lends $15,000 to a niece for graduate school living expenses. The niece’s older sibling co-signs.

The note might:

• Defer payments until six months after graduation
• Accrue interest during school
• Spell out what happens if the borrower leaves school early

A realistic clause:

In-School Status: While Borrower is enrolled at least half-time in an accredited program, no monthly payments are required. Interest will continue to accrue and will be added to the principal balance at the end of each calendar year.

Again, the co-signer is on the hook for all of this if the borrower can’t or won’t pay after graduation.

Secured vs. unsecured: examples of promissory note examples with co-signer

Co-signed notes can be secured (backed by collateral) or unsecured (backed only by the promise to pay). The co-signer’s risk looks different in each case.

Example: Secured loan with vehicle as collateral and a co-signer

Picture a $12,000 loan to buy a car from a private seller. The borrower’s friend co-signs, and the car itself is collateral.

The note and a separate security agreement might say:

Collateral: 2021 Honda Civic, VIN [number], including all accessions and proceeds.
Remedies: Upon default, Lender may repossess and sell the Collateral. Any sale proceeds will be applied to the outstanding balance. Borrower and Co-Signer remain liable for any deficiency.

This is one of the best examples to show that even if the car is repossessed and sold, the co-signer can still owe money if the sale doesn’t cover the full balance.

Example: Unsecured personal loan with a co-signer

Now compare an unsecured $5,000 loan for medical expenses. There is no collateral at all; the lender’s only protection is the creditworthiness of the borrower and co-signer.

The note will usually:

• Emphasize the co-signer’s joint and several liability
• Include attorney’s fees and collection costs
• Allow the lender to assign the note to a collection agency or debt buyer

Consumer advocates like the Federal Trade Commission (FTC) and CFPB have repeatedly warned that co-signers often underestimate how fast unsecured debt can go to collections and affect their credit. See the FTC’s credit and debt resources: https://consumer.ftc.gov/credit-loans-debt

Key clauses that show up in the best examples

When people search for the best examples of promissory note examples with co-signer, they’re usually trying to figure out what language actually matters. Across real examples, you’ll see the same building blocks:

Identification of parties
Full legal names, addresses, and whether the co-signer is called a “Co-Signer,” “Guarantor,” or “Surety.” The label matters less than the actual promise they make.

Joint and several liability
This phrase means the lender can collect the entire amount from the borrower, the co-signer, or any combination. If this phrase is missing, the co-signer may argue they only promised a limited guarantee.

Waiver of defenses
Many notes include language where the co-signer waives certain defenses, such as requiring the lender to first sue the borrower. This can significantly strengthen the lender’s position.

Default and acceleration
The note should define default (missed payment, bankruptcy, selling collateral, etc.) and explain that on default, the entire balance can become due immediately.

Governing law and jurisdiction
The note usually states which state’s law applies and where lawsuits must be filed. This matters a lot in cross-border or multi-state situations.

If your draft doesn’t clearly cover these points, compare it against standard guidance from legal self-help sites or your local court system. Many state court websites publish sample forms for promissory notes and small claims; for example, state judiciary portals often host templates and instructions for self-represented litigants.

2024–2025 trends affecting co-signed promissory notes

The legal structure of a promissory note hasn’t changed much in decades, but how people use co-signers has shifted in the 2024–2025 environment.

Higher interest rates and tighter credit
With interest rates elevated compared to the late 2010s and early pandemic years, banks and online lenders are more cautious. That means:

• More requests for co-signers on marginal credit applications.
• Higher rates for unsecured loans, even with a co-signer.
• Increased use of private promissory notes between individuals as an alternative to institutional loans.

Digital signatures and online templates
Electronic signatures are widely accepted in the U.S. under the ESIGN Act and state versions of the Uniform Electronic Transactions Act. In practice, that means:

• Co-signed promissory notes are often signed via e-sign platforms.
• Courts generally enforce properly authenticated e-signed notes just like paper ones.

For background on electronic signatures and contract enforceability, you can review guidance from the U.S. Government Publishing Office and related federal resources: https://www.govinfo.gov/

Greater focus on consumer protection
Regulators and courts have been paying closer attention to:

• Whether co-signers received clear, written disclosures.
• Whether the lender misrepresented the co-signer’s risk.
• Whether the note’s interest rate and fees comply with state usury and consumer protection laws.

This is why the best examples of promissory note templates with a co-signer now tend to include:

• Plain-English warnings to the co-signer about their liability.
• Separate signature lines for the co-signer with their own acknowledgment.
• Clear breakdown of interest, fees, and total of payments.

Drafting tips drawn from real examples of promissory note examples with co-signer

Pulling all of this together, here are patterns you see again and again in strong, enforceable notes:

Clarity over cleverness
Simple sentences beat dense legal jargon. Courts care more about whether the parties understood the deal than whether the language sounds “lawyerly.”

Specific numbers beat vague promises
Instead of “Borrower will pay back when able,” real examples use:

• Exact dates or a clear formula (“on the 1st of each month, beginning X date”).
• A defined interest rate or a reference rate plus a margin.
• A total number of payments or a maturity date.

Separate signature blocks
The co-signer should have their own signature block, often directly under a bolded paragraph summarizing their obligations. That makes it harder for anyone to argue later that they “didn’t realize” they were a co-signer.

State law check
Because promissory note and co-signer rules can vary by state, it’s smart to:

• Check your state’s attorney general or court website for sample forms.
• Look at local small-claims court resources for how judges in your area treat notes.

For broader contract law background, university law libraries (for example, Harvard Law School’s library resources at https://hls.harvard.edu/library/) can be a useful reference point, though you’ll still want state-specific guidance.

FAQs about co-signed promissory notes

What is a simple example of a promissory note with a co-signer?

A straightforward example of a co-signed note is a $5,000 personal loan from one friend to another, with a third friend co-signing. The note lists all three by name and address, sets a fixed interest rate, explains the monthly payment, and includes a line stating that the co-signer is jointly and severally liable for the full amount if the borrower does not pay.

Do all examples of promissory note examples with co-signer require a lawyer?

No. Many individuals and small businesses use templates and adapt them without a lawyer, especially for modest loan amounts. That said, if the loan is large, crosses state or national borders, or involves a business, it’s wise to have an attorney review the document. A short consultation can be cheaper than litigating a badly drafted note later.

Can a co-signer be removed from a promissory note?

Sometimes, but not unilaterally. The lender must agree in writing. In practice, removal usually happens when:

• The borrower refinances the loan in their own name, or
• The lender signs a formal release of the co-signer.

Without that written release, the co-signer stays responsible, even if the borrower has been paying on time for years.

Are there real examples where co-signers were sued instead of borrowers?

Yes. In many collection cases, lenders go after co-signers because they often have better income or assets. Court records across the U.S. show repeated situations where:

• The borrower disappears or declares bankruptcy.
• The lender sues the co-signer and obtains a judgment.
• The co-signer’s wages or bank accounts are then targeted for collection, depending on state law.

What happens if the borrower files bankruptcy but the co-signer does not?

If the borrower’s obligation is discharged in bankruptcy, the co-signer’s obligation usually remains unless the co-signer also files bankruptcy and receives a discharge. That’s one of the biggest risks shown in real-world examples: the co-signer can be left holding the bag after the borrower’s debts are wiped out.

Where can I find more examples of promissory note templates with co-signer language?

Look at:

• Your state court’s self-help or small-claims website for sample forms.
• Legal aid organizations and bar association resources.
• Consumer guidance from agencies like the CFPB and FTC.

Use those examples as a starting point, then adapt them to your situation and have a local attorney review anything involving significant money.

Bottom line: The strongest examples of promissory note examples with co-signer all share the same DNA: clear parties, specific payment terms, explicit co-signer liability, and realistic default provisions. If your document checks those boxes and is tailored to your state’s law, you’re far closer to a note that will actually hold up when it matters most.