Final answer:
The correct answer is C) Promissory Note, which is a document where the borrower commits to paying back the lender a certain amount of money under specific terms including the interest rate and loan duration.
Step-by-step explanation:
The main answer to the student's question is C) Promissory Note. A legally binding letter from the lender to the mortgagor that states the terms of the loan is a promissory note. This is a written agreement where the borrower promises to repay the lender a certain sum of money under specific terms, which typically includes the interest rate and duration of the loan. Although the terms like loan agreement, mortgage deed, and loan estimate are also associated with the borrowing process, the promissory note is the document that specifically outlines the borrower's promise to pay back the loan.A loan agreement may include a promissory note within it, but it is a more comprehensive document detailing all contractual obligations of both parties. A mortgage deed, on the other hand, is a document that legally ties the loan to the physical property, serving as collateral for the loan. Lastly, a loan estimate is an early document provided after applying for a mortgage, which outlines the estimated costs associated with the loan, rather than the final terms.In conclusion, when discussing a legally binding document that states the borrower's commitment to repay a loan with specified terms, the correct choice is a Promissory Note.