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A promissory note is a document outlining borrowed money and its repayment terms. There are two types: secured and unsecured. A secured promissory note allows the lender to claim an asset if the borrower fails to repay. In contrast, an unsecured note does not involve collateral, meaning the lender must rely on legal action for recovery if payment defaults. Promissory notes offer benefits like payment certainty, marketability, and judicial certainty under the Uniform Commercial Code (UCC), which specifies conditions for negotiability. For the obligation to be valid, payment terms must be unconditional and set for a definite time, enhancing clarity on the amount owed and ease of transfer.