Simple or negotiable promissory note – what is the difference?

By The Template Store · Fact-checked October 1, 2026

The Promissory Notes Act generally classifies promissory notes into simple and negotiable notes. Negotiable promissory notes are in turn divided into bearer notes and order notes. Older terms such as "mortgage debt" or "consumer debt" should not be described as separate main types under the Promissory Notes Act.

Simple promissory note

Section 26 defines a simple promissory note as a note issued to a specific person. It can be transferred, but according to Section 27, the new creditor generally does not gain better rights against the debtor than the previous creditor had. This means the debtor's objections have stronger protection than in many acquisitions of negotiable promissory notes.

Negotiable promissory note

Section 11 states that promissory notes to the bearer, or to a specific person or order, are negotiable. A bearer note ties the right strongly to possession. An order note is issued to a specific person or order and can be transferred through the mechanism required by law.

For an acquirer acting in good faith, there are special rules that in some cases limit the debtor's ability to raise the same objections as against the original creditor. Therefore, private individuals should not choose the negotiable form without understanding the consequences.

What happens if the promissory note is sold or transferred?

A simple promissory note can be transferred. The new creditor normally does not gain better rights against the debtor than the original one had (Section 27 of the Promissory Notes Act). Upon transfer, it is important to notify the debtor about who is to receive the payment. According to Section 29, payment to the previous creditor may in some cases still be valid if the debtor was unaware of and had no reasonable grounds to suspect the transfer. According to Section 31, as a general rule, the debtor must be notified for the transfer to be valid against the transferor's creditors; exceptions exist.

With a negotiable promissory note, possession of the original document and any chain of transfers becomes particularly important. According to Section 21, the debtor is as a general rule not obliged to pay a negotiable promissory note without the document being returned. The good faith rules in Section 15 can also affect which objections the debtor is permitted to make against a new creditor. This is a central reason why a negotiable promissory note should not be chosen thoughtlessly for a private loan.

Source: The Promissory Notes Act, especially Sections 15, 21, 27, 29, and 31.

Transferring an ordinary B2B receivable is not the same as issuing a new promissory note. For an assignment agreement, notice to the debtor and a record of delivery and receipt, see our claim assignment and debtor notification templates (Word, PDF, Excel). The package is for simple commercial claims rather than negotiable promissory notes; consider the debtor’s defences and Sections 27, 29 and 31 of the Swedish Promissory Notes Act.

What is not a separate type of promissory note?

A loan can be secured by a pledge, relate to a home purchase, or be a consumer credit without "pledge loan," "mortgage debt," or "consumer debt" becoming their own categories of promissory notes according to the system of the Promissory Notes Act. Collateral and credit rules are separate issues that may be covered by other legislation.

Which one is suitable for private loans?

When a private individual lends money to a specific friend, relative, or cohabitant, a simple promissory note is often easier to understand because the creditor is specified. If the parties actually want the debt instrument to be able to circulate with the special legal effects that apply to negotiable promissory notes, that form must be chosen intentionally.

What should a simple promissory note between private individuals contain?

If you need to document a standard private loan, the text should be clear regarding both the parties and the payment commitment itself. A practical template may include:

• the lender's and borrower's names and identification details,
• the loan amount and when the money has been or will be paid out,
• whether interest is to be paid and how it is calculated, if applicable,
• the repayment due date or installment plan,
• what applies in the event of late payment and how payments are documented,
• the date and the borrower's signature, as well as preferably clear documentation of the parties' agreement.

This is a practical checklist, not a complete list of mandatory formal requirements. The legal effects of the promissory note are influenced by the content and applicable regulations. For a regular loan to a specific friend or family member, you can start with an editable template for a simple promissory note instead of using a negotiable order note by mistake.

Promissory notes between cohabitants – is a cohabitation agreement also needed?

In some cases. A promissory note concerns a debt, while a cohabitation agreement according to the Cohabitation Act can change which property is included in the division of assets. In the case of different cash contributions to a joint home, both may need to be assessed together. Read the guide on promissory notes and cohabitation agreements with different cash contributions before choosing a document type.

Choose the right promissory note template based on the situation

For a standard loan where the lender is named, a simple promissory note (SEK 29) can be an appropriate starting point. If the debt instrument is intended to be able to circulate as an order or bearer note, you need to understand and assess the negotiable promissory note (SEK 49). If you are unsure: use the checklist for choosing a promissory note and read the in-depth information on statute of limitations. The statute of limitations is not automatically affected by the document being saved.