what is a secured promissory note
received. Also called a ânote.â Secured Promissory Note: A note in which the borrowerâs promise to pay a certain amount is backed up by certain specified property (called âcollateralâ). If the borrower does not repay, the lender can take the collateral. A lender is more protected under a secured note than under an unsecured note. It has the certainty that if money isnât available, it can at least get something of value without going to court. Security Agreement: An agreement that supports a secured promissory note. It describes the collateral and the lenderâs rights if the borrower defaults on the note.