Which covenant requires the borrower to pay legal expenses?

The covenant that specifies the requirement for the borrower to pay legal expenses is indeed associated with the obligation to acknowledge indebtedness. This covenant typically requires borrowers to recognize and affirm their obligation to repay their debts, and it encompasses all associated costs, including legal expenses that may arise from the loan agreement.

This understanding is rooted in the principle that when a borrower acknowledges their indebtedness, they also accept the responsibilities that come with it, which can include covering legal fees. Thus, this covenant helps ensure that borrowers are fully aware of their financial obligations and the potential costs involved in the financing process.

The other options relate to different aspects of borrower responsibilities but do not specifically address the obligation to pay legal expenses. For example, the covenant to pay indebtedness focuses primarily on the borrower’s obligation to repay borrowed funds, while the covenant to insure the property deals with maintaining proper insurance coverage. The covenant of property inspection relates to the right of the lender to check on the condition of the collateral. Since none of these directly involve the payment of legal expenses, they do not fulfill the criteria set by the question.