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A promissory note is a document that outlines borrowed money and its repayment structure. There are two types: secured and unsecured. A secured note includes a condition where the lender can claim an asset if the borrower fails to repay. In contrast, an unsecured note does not provide the lender with an asset to secure the loan, meaning they may need to pursue legal action if payment is not made. Promissory notes offer benefits such as certainty of payment and marketability, complying with the Uniform Commercial Code (UCC). For a note to be negotiable, the borrower's payment obligation must be unconditional and due on a specific date, reducing ambiguity regarding the amount owed.