How do I delete an unused folder in notes?

Sorry, I don't know why you cannot delete it.

I have tested deleting both notes and folders on my iPhone with iOS 14.8 and can delete either a note or a folder by swiping left and then taping the trash can icon. I have also tested this with empty folders. The only folders that don't have a trash can icon when I swipe left are the built in "All Cloud" and "Notes" folders.

Also see: Search and organize your notes in folders on iPhone - Apple Support

If someone else here doesn't reply with something else to try, you may want to use the "Get Support" button at the top right of this page.

When you slide the folder to the left in the Notes app, do ANY icons appear? If so, what do they look like?

Also, what iOS version are you running on your iPhone 7 (from Settings > General > About > Software Version)?

Slide it to the left and then tap the trash can icon.

Sliding to the left is a common way of deleting things on an iPhone and is used in many apps, not just Notes.