What is the primary function of a mortgage note?

The primary function of a mortgage note is to provide a binding agreement between the borrower and the lender. This document outlines the borrower's promise to repay the loan amount under the specified terms, including the interest rate, payment schedule, and consequences of default. It serves as evidence of the debt and the lender's ability to enforce the repayment agreement legally.

The mortgage note is a critical legal document that ensures both parties are clear on their obligations and rights, setting the foundation for the lender's security interest in the property. This is crucial for the lender because if the borrower fails to repay, the lender can take action based on the terms outlined in the note to recover the owed amount.

The other options focus on different aspects of the mortgage process. Transferring ownership pertains to the mortgage deed rather than the note, summarizing closing costs relates to the closing disclosure, and evaluating market trends is outside the scope of what a mortgage note addresses. Thus, understanding the role of the mortgage note is essential for comprehending the entire mortgage process and the legalities involved.