IOU template
Money lent between people, written down so nobody remembers it differently later.
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Example
Example: a $6,000 family loan repaid over 12 months at 4%
Pat Example lends Jamie Sample $6,000 by bank transfer on November 2, 2026, for a used car. Jamie repays it in 12 monthly installments from December 1, 2026, with 4% interest a year. Written for: Anywhere (plain English), US dollars, US Letter.
- Amount 6000: the IOU writes “$6,000.00 (six thousand dollars)”.
- Monthly instalments, 12, first due December 1, 2026, interest 4: the paper promises 12 monthly installments “from December 1, 2026 to November 1, 2027, as set out in the schedule below”.
- It adds that Jamie may repay early without penalty, and that if an installment is more than 14 days late, the whole balance outstanding becomes due at once.
| No. | Due | Payment | Principal | Interest | Balance |
|---|---|---|---|---|---|
| 1 | December 1, 2026 | $510.90 | $490.90 | $20.00 | $5,509.10 |
| 2 | January 1, 2027 | $510.90 | $492.54 | $18.36 | $5,016.56 |
| 3 | February 1, 2027 | $510.90 | $494.18 | $16.72 | $4,522.38 |
| 4 | March 1, 2027 | $510.90 | $495.83 | $15.07 | $4,026.55 |
| 5 | April 1, 2027 | $510.90 | $497.48 | $13.42 | $3,529.07 |
| 6 | May 1, 2027 | $510.90 | $499.14 | $11.76 | $3,029.93 |
| 7 | June 1, 2027 | $510.90 | $500.80 | $10.10 | $2,529.13 |
| 8 | July 1, 2027 | $510.90 | $502.47 | $8.43 | $2,026.66 |
| 9 | August 1, 2027 | $510.90 | $504.14 | $6.76 | $1,522.52 |
| 10 | September 1, 2027 | $510.90 | $505.82 | $5.08 | $1,016.70 |
| 11 | October 1, 2027 | $510.90 | $507.51 | $3.39 | $509.19 |
| 12 | November 1, 2027 | $510.89 | $509.19 | $1.70 | $0.00 |
Eleven payments of $510.90 and a last one of $510.89 that clears the balance: $6,130.79 in all, $130.79 of it interest. With the rate left empty it is 12 payments of $500.00 and the line “No interest is payable on this loan.” The paper ends with signature lines for the borrower and the lender.
How it works
- Enter the amount, the date the money changed hands and whether it was cash or a transfer. The amount is written out in words for you.
- Choose a repayment date, or monthly instalments and the first due date. With an interest rate, the schedule works out every payment.
- Fill in both names and addresses. Anything else you agreed goes in the last box, in your own words.
- Download the PDF, print a copy for each of you and sign. Lend by bank transfer where you can, so there is a record beside the paper.
Frequently asked questions
- Is an IOU legally binding?
- It is evidence that the money was lent and on what terms, which is usually what a dispute turns on. How far it goes on its own depends on where you are: in the US a signed, unconditional promise to pay is a promissory note; in England an IOU that only acknowledges a debt is evidence rather than a contract. For a large sum, a loan agreement signed by both of you is the safer paper.
- What is the difference between the IOU and the loan agreement?
- The IOU is the borrower’s promise, in the first person: “I acknowledge that I owe…”. In the plain-English, Spanish, Brazilian, Italian and Turkish versions it also has a line for the lender to sign, to confirm the sum and the terms; the French and German ones are signed by the borrower alone. The loan agreement is a contract that sets out what each side agreed, and both sign it. The loan agreement page makes that version.
- Why is the amount written in words as well?
- A figure can have a digit added to it; words cannot be changed without it showing. Where the two disagree, the words are usually taken as meant.
- Do I have to charge interest on a family loan?
- Not for the paper to be valid. In the US, though, an interest-free loan of more than $10,000 between family members can have tax consequences, because the IRS may treat the interest you did not charge as a gift. For larger sums, check the applicable federal rate or ask an accountant.
- Can I leave parts blank and fill them in by hand?
- Yes: an empty name, address, amount or date prints as a line to write on, and an empty amount leaves a line for the words too. The repayment schedule is printed only when the amount and the first due date are filled in.
- Is this legal advice?
- No. It is a form. For a large sum, or a loan you expect to be difficult, talk to a lawyer.
- Is what I type uploaded?
- No. The PDF is made in your browser and nothing you type leaves your device. Nothing of ours is printed on the paper.
Made for a specific use
Related tools
委 Loan agreement between friends and family Lending to a friend or relative, on paper both of you have signed. ¥ Text tools Loan repayment calculator The payment, and where it actually goes. 委 Promissory note (借用書) Money lent, written down properly. 委 Korean IOU (차용증) A loan between people in Korea, written down the way Korean paperwork expects.