What is a deed of trust?

A Deed of Trust is a document used in California when taking out a loan to purchase property. It is similar to a mortgage, however, instead of the borrower directly borrowing money from the lender, the borrower transfers the title of the property to a third party, known as the trustee. The trustee holds the title to the property as security for the loan and is responsible for the collection of payments from the borrower, who remains in possession of the property. The benefits of a Deed of Trust are that the lender is assured that the borrower is making payments since the trustee has the right to foreclose on the property if payments are late or not made. The trustee also has the power to take any actions that they feel necessary to secure the loan, such as changing a lien or filing a lawsuit. For a Deed of Trust to be valid, it must include the document title, legal description of the property, names of the borrower, lender, and trustee, loan amount, repayment terms, interest rate, and signatures of all parties involved. It should also include any additional instructions regarding payment or foreclosure. Once signed, a Deed of Trust must be filed with the county recorder’s office in the county where the property is located. This ensures that anyone interested in the property is aware of the loan and will be held accountable for any violation of the terms of the trust.

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What is a deed of trust?

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