Iowa Code

Iowa Code § 554.3304 (2026)

Overdue instrument

✓ current as of July 2026

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1. An instrument payable on demand becomes overdue at the earliest of the following times:

a. on the day after the day demand for payment is duly made;

b. if the instrument is a check, ninety days after its date; or

c. if the instrument is not a check, when the instrument has been outstanding for a period of time after its date which is unreasonably long under the circumstances of the particular case in light of the nature of the instrument and usage of the trade.

2. With respect to an instrument payable at a definite time the following rules apply:

a. If the principal is payable in installments and a due date has not been accelerated, the instrument becomes overdue upon default under the instrument for nonpayment of an installment, and the instrument remains overdue until the default is cured.

b. If the principal is not payable in installments and the due date has not been accelerated, the instrument becomes overdue on the day after the due date.

c. If a due date with respect to principal has been accelerated, the instrument becomes overdue on the day after the accelerated due date.

3. Unless the due date of principal has been accelerated, an instrument does not become overdue if there is default in payment of interest but no default in payment of principal. 94 Acts, ch 1167, §39, 121, 122 \n

Notes of Decisions

Cited in 4 cases, 1978–1991 · leading case: Waukon Auto Supply v. Farmers & Merchants Sav. Bank, 440 N.W.2d 844 (Iowa 1989).

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Waukon Auto Supply v. Farmers & Merchants Sav. Bank, 440 N.W.2d 844 (Iowa 1989). · cites it 6× “Iowa Code § 554.3304 (2). The Bank disagrees with the district court’s conclusion that the Bank had notice of restrictions on Rosendahl’s authority to make certain transactions with it.”

Phariss v. Eddy, 478 N.W.2d 848 (Iowa Ct. App. 1991). · cites it 2× “Iowa Code § 554.3304 (l)(a) (1991). Security State Bank is charged with knowledge of claims apparent from the face of the instrument.”

First Nat'l Bank in Lenox v. Creston Livestock Auction, Inc., 447 N.W.2d 132 (Iowa 1989). · cites it 2× “See Iowa Code § 554.3304 (1987). [Crestón Bank] is a “holder in due course.”

Woodward v. Comm'r, 37 T.C.M. 715 (Tax Ct. 1978). “We are of the opinion that petitioners' witnesses properly disregarded these factors in reaching their conclusion as to the fair market value of the transferred notes.”

— Iowa Code § 554.3304(2) — 1 case

Waukon Auto Supply v. Farmers & Merchants Sav. Bank, 440 N.W.2d 844 (Iowa 1989). “Iowa Code § 554.3304 (2). The Bank disagrees with the district court’s conclusion that the Bank had notice of restrictions on Rosendahl’s authority to make certain transactions with it.”

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