Summarize the following:
A negotiable instrument is a special writing that can be transferred from one person to another and exchanged for money. If you want to make a promissory note non-negotiable, meaning the note will not be able to be transferred from one person to another, you must simply write "non-negotiable" somewhere on the promissory note.  For example, assume you loan money to a friend and execute a promissory note. The promissory note requires your friend to repay the amount loaned, plus interest, on a certain date. At this point, you are considered the "holder" of the promissory note, because you have possession of the note and can ask your friend, "the borrower," for the amount of money owed on the date agreed upon. However, because a promissory note is usually negotiable, you may transfer your right to collect to your brother. If you do this, your brother will become the holder of the note and will be able to ask your friend for the money owed when it becomes due. However, let's now assume the promissory note was made non-negotiable. If this is the case, you will not be able to transfer your rights as the holder to another person (i.e., your brother), and only you will be able to collect from the borrower (i.e., your friend). Understanding the idea of a negotiable instrument will help you in creating a promissory note that achieves your desired intentions (i.e., whether you want the note to be negotiable or non-negotiable). A note is a promise to pay money while a draft is an order to pay money. Before you create a promissory note, you should try and understand these subtle differences. When you create your promissory note, be sure you word the note in such a way as to make it a promise and not a demand.  The most common example of a draft is a bank check. A bank check effectively orders a bank to pay the person presenting that check the amount owed.  The most common example of a note is a promissory note, which you know is a promise by a borrower to pay a holder an amount owed. In order to create a legally enforceable promissory note, the law generally requires that certain criteria be fulfilled. Most states follow the Uniform Commercial Code ("UCC"), which requires that:  The note be in writing, be signed, and promises the payment of money; The promise must be unconditional; The amount of money must be a fixed amount (with or without interest); The instrument must be payable to holder; The promise must be payable at a definite time; and The promise must not include any other act in addition to the payment of money.
Think of a promissory note as a negotiable instrument. Know the difference between a note and a draft. Meet the requirements of a legally acceptable promissory note.