What does the 'note' in a mortgage loan specify?

The 'note' in a mortgage loan is a legal document that outlines the exact terms of the financial obligation between the borrower and the lender. This document details critical information such as the loan amount, interest rate, payment schedule, and the consequences of default.

By specifying these terms, the note serves as a binding agreement, ensuring that both parties understand their responsibilities and rights throughout the duration of the loan. This clarity is crucial for the borrower, as it defines how much they will owe, when payments are due, and how much interest they will be charged over the life of the loan. Essentially, the note is fundamental in establishing the framework of the financial transaction, making it the correct answer.

In contrast, the other options relate to aspects that are not defined in the note itself. For example, the terms of property sale concern the transaction of buying or selling the property, conditions for property appraisal involve assessing the property's value, and the pledge of the property as collateral relates to the security interest in the property but does not encompass the financial terms outlined in the note.