Which document provides evidence of the borrower's debt to the lender?

The correct answer is the note. The note is a legal document in which the borrower formally promises to repay a specific amount of money to the lender under agreed-upon terms, including the interest rate and repayment schedule. It is essential because it outlines the borrower’s obligation, making it evidence of the debt itself.

If a borrower defaults on the loan, the note serves as a critical piece of evidence for the lender in enforcing repayment or pursuing collection actions. While the mortgage is related and serves to secure the debt by tying the property to the loan, it does not in itself serve as evidence of the debt; rather, it establishes the lender's rights over the property in case of default.

The deed, on the other hand, is a document that conveys ownership of the property and does not pertain to the financial obligation directly. Lastly, the settlement statement is a detailed description of the financial transactions involved in closing a real estate transaction but does not specifically indicate the borrower's debt to the lender. Thus, the note clearly serves as the documentation confirming the borrower's debt.