Which document outlines the terms of a mortgage loan?

Which document outlines the terms of a mortgage loan?

• A. Title insurance
• B. Loan estimate
• C. Mortgage note
• D. Amortization schedule

Answer: (C)

The document that outlines the terms of a mortgage loan is the mortgage note. The mortgage note serves as a legal document that specifies the borrower's promise to repay the loan under agreed-upon terms, including details such as the loan amount, interest rate, repayment schedule, and the duration of the loan. It also includes the borrower's rights and obligations, along with any applicable penalties for non-compliance. In contrast, title insurance protects against losses from defects in the title to the property, ensuring that the lender has a valid claim against the asset. The loan estimate is a standardized document that provides potential borrowers with essential information about the terms of the loan, including the estimated monthly payment and closing costs, but it does not serve as a binding agreement. Lastly, an amortization schedule is a table that outlines each payment over the loan term, detailing how much of each payment goes toward principal and interest but does not define the loan terms themselves. Thus, the mortgage note is the definitive document that delineates the specific terms and conditions of the mortgage loan.

The document that outlines the terms of a mortgage loan is the mortgage note. The mortgage note serves as a legal document that specifies the borrower's promise to repay the loan under agreed-upon terms, including details such as the loan amount, interest rate, repayment schedule, and the duration of the loan. It also includes the borrower's rights and obligations, along with any applicable penalties for non-compliance.

In contrast, title insurance protects against losses from defects in the title to the property, ensuring that the lender has a valid claim against the asset. The loan estimate is a standardized document that provides potential borrowers with essential information about the terms of the loan, including the estimated monthly payment and closing costs, but it does not serve as a binding agreement. Lastly, an amortization schedule is a table that outlines each payment over the loan term, detailing how much of each payment goes toward principal and interest but does not define the loan terms themselves.

Thus, the mortgage note is the definitive document that delineates the specific terms and conditions of the mortgage loan.