Updated October 11, 2026. Quick answer: 10% a year, or the quarterly market rate when that is higher, by written agreement, and 9% a year on money after it becomes due when no other rate is agreed (Mo. Rev. Stat. 408.030 and 408.020).
Missouri promissory note at a glance
| Item | What the documents say |
|---|---|
| Maximum interest rate on a private loan | 10% a year, or up to the quarterly market rate when that exceeds 10% |
| Rate if the note names none | 9% a year on money after it becomes due and payable |
| Penalty for charging too much | A person who pays interest above the lawful rate may recover twice the interest paid within five years, plus costs and an attorney’s fee |
What Missouri law says about interest
Parties may agree in writing to interest up to ten percent per annum, or up to the quarterly market rate when that exceeds ten percent.
When no other rate is agreed, creditors may receive nine percent per annum on money due on written contracts.
A person who pays interest above the lawful rate may recover twice the interest paid within five years, plus costs and attorney’s fee (408.030.2).
The sources in their own words
- Interest limit: “not exceeding ten percent per annum on money due” (RSMo 408.030 Interest, maximum rate allowed).
- Rate when none is agreed: “nine percent per annum, when no other rate is agreed upon, for all moneys after they become due and payable” (RSMo 408.020 When no rate of interest is agreed upon).
- Exemption or penalty: “recover twice the amount of the interest thus paid” (RSMo 408.030 Interest, maximum rate allowed).
- Time limit to sue: “must be commenced within ten years after the due date” (RSMo 400.3-118 Statute of limitations).
- Time limit to sue: “Within five years: (1) All actions upon contracts, obligations or liabilities” (RSMo 516.120 What actions within five years).
- Signature: “the person signed the instrument” (RSMo 400.3-401 Signature).
If you’re ready to put it in writing
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Signing the note: signature, witness, notary
Under UCC 400.3-401 a person is not liable on an instrument unless the person (or an authorized agent) signed it. A note is signed by the person who promises to pay.
None of the sections read for Missouri requires a witness or a notary for the note itself. A note secured by real property is a separate question; see what an intra-family mortgage requires.
How long a lender has to sue
Missouri’s enacted UCC 400.3-118 requires an action on a note payable at a definite time within ten years after the due date, displacing the five-year general contract limit of 516.120.
A worked example: a $20,000 note
Suppose a relative lends you $20,000 and you sign a note for 5 years at 8% a year, paid monthly. With r = 8%/12 and n = 60 months, the level payment is principal times r divided by (1 minus (1 + r) to the power of negative n): $405.53 a month, computed here from these assumed inputs, not quoted. Over the 60 payments that is $24,331.80 in total, of which $4,331.80 is interest.
The 8% rate sits inside the Missouri limit in the table above, which is why it was chosen. The federal side of a loan between relatives is covered at family loan minimum interest rate and AFR rates by month.
A loan or a gift?
A loan that may never be repaid is taxed differently; see family loan vs gift, forgiving a family loan and gift tax by state.
What the documents do not say
- The quarterly market rate is not stated on this page, so what a lender may charge above 10% is not given as a figure. Other Missouri sections that were not read may allow different rates for some loans, so 408.030 is the general rule, not a limit shown to apply to every loan.
- Silence on a witness or notary in the sections read is not proof that no other Missouri law requires one.
Common mistakes
- Charging more than the limit in Missouri, which the table gives as 10%, or the quarterly market rate if higher, makes the lender liable to the person who paid for twice the interest paid, plus costs and a reasonable attorney’s fee, if that person sues within five years (RSMo 408.030.2).
- Leaving the rate out: the legal rate of 9% applies to money after it becomes due when a note names none, and it is rarely what the parties meant.
- Waiting too long to enforce: Missouri allows 10 years (UCC note) to sue on a written note.
Related: promissory notes by state, promissory note requirements, family loan minimum interest rate, and gift tax by state.
Sources
- RSMo 408.030 Interest, maximum rate allowed: https://revisor.mo.gov/main/OneSection.aspx?section=408.030
- RSMo 408.020 When no rate of interest is agreed upon: https://revisor.mo.gov/main/OneSection.aspx?section=408.020
- RSMo 400.3-118 Statute of limitations: https://revisor.mo.gov/main/OneSection.aspx?section=400.3-118
- RSMo 516.120 What actions within five years: https://revisor.mo.gov/main/OneSection.aspx?section=516.120
- RSMo 400.3-401 Signature: https://revisor.mo.gov/main/OneSection.aspx?section=400.3-401
Sources: the primary documents linked above, read on October 11, 2026. General information, not legal or tax advice. Statutes change and courts read them, so confirm anything consequential with a lawyer licensed in your state.