Washington State Real Estate Practice Exam 2025 – Complete Preparation Guide

A promissory note is indeed an agreement in which one party promises to pay a specified amount of money to another party at a designated time. This financial instrument details the terms of the loan, including the principal amount, interest rate, repayment schedule, and any conditions related to the payment. It serves as a legal document that obligates the borrower to repay the lender under the agreed-upon terms.

The other options do not accurately reflect the nature of promissory notes. A promissory note applies to both secured and unsecured loans, meaning that it is not limited to just secured loans. Additionally, notarization of a promissory note can enhance its authenticity and may be required in some jurisdictions, but notarization is not a prerequisite for the validity of the note itself. Thus, the defining characteristic remains that it is an agreement to pay a specified amount of money at a certain time, making the answer true.