Which document outlines the terms and conditions of a mortgage loan?

The document that outlines the terms and conditions of a mortgage loan is the Mortgage Agreement. This legally binding contract details the specifics of the loan, including the interest rate, loan amount, repayment terms, and the responsibilities of both the borrower and the lender. It establishes the framework for how the loan will function throughout its duration and what is required from each party involved.

The Mortgage Agreement also typically includes important clauses pertaining to foreclosure, default, and what happens in cases of late payments or nonpayment, making it the core document that delineates the rights and obligations of both parties in the loan transaction. Additionally, it serves as the collateral interest document that secures the loan with the property being financed.

While other documents, such as the Loan Estimate and the Closing Disclosure, provide vital information regarding the cost and terms of the loan, they do not serve as the binding contract defining the relationship between the borrower and lender. The Promissory Note represents the borrower’s promise to repay the loan but does not cover the broader terms of the mortgage as comprehensively as the Mortgage Agreement does.