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Deed of Trust
Secure real estate loans effectively with this Deed of Trust Template.
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Deed of Trust
This Deed of Trust (“Deed”) is made on [Date], by and between:
Borrower (Trustor): [Borrower Full Name], residing at [Address]
Lender (Beneficiary): [Lender Full Name/Entity], with an office at [Address]
Trustee: [Trustee Full Name], with an office at [Address]
Property: [Legal Description and Address of the Property]
1. Grant in Trust
Borrower hereby irrevocably grants, transfers, and conveys the described property to Trustee, in trust, with power of sale, as security for repayment of the loan described in this Deed.
2. Secured Obligation
This Deed secures repayment of a loan in the original principal amount of [Loan Amount], evidenced by a promissory note executed by Borrower in favor of Lender on [Date].
3. Borrower Covenants
Borrower agrees to:
Make timely payments of principal, interest, taxes, and insurance.
Maintain the property in good condition and not commit waste.
Keep the property insured against loss.
Comply with applicable laws and restrictions affecting the property.
4. Default and Remedies
If Borrower defaults on the secured obligations, Lender may declare the entire balance due. Trustee is authorized to sell the property at public auction in accordance with applicable law, and apply proceeds to repayment of the loan and costs.
5. Trustee Powers
Trustee holds the power of sale and shall act impartially in accordance with law upon Lender’s instructions following a default.
6. Reconveyance
Upon full repayment of the secured obligations, Lender shall direct Trustee to reconvey the property to Borrower, releasing this Deed of Trust.
7. Governing Law
This Deed shall be governed by and construed in accordance with the laws of the State of [State].
8. Signatures
IN WITNESS WHEREOF, the parties have executed this Deed of Trust as of the date first written above.
Borrower (Trustor): ______________________________
Name: __________________________________________
Date: ___________________________________________
Lender (Beneficiary): _____________________________
Name: __________________________________________
Date: ___________________________________________
Trustee: _______________________________________
Name: __________________________________________
Date: ___________________________________________
Notary Acknowledgment (if required by jurisdiction)
Details
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Deed of Trust
DEED OF TRUST FAQ
What is a Deed of Trust?
A Deed of Trust is a legal document that secures a real estate loan by transferring legal title of the property to a neutral third party, known as the trustee, while the borrower retains equitable ownership. The trustee holds the property in trust until the borrower repays the loan in full, at which point the title is reconveyed to the borrower. If the borrower defaults, the trustee has the authority to initiate foreclosure proceedings on behalf of the lender.
Why is a Deed of Trust important?
It protects the lender by creating a security interest in the property, ensuring that the debt is backed by a tangible asset. At the same time, it sets out the borrower’s responsibilities—such as maintaining the property and paying taxes—and provides a streamlined foreclosure process in the event of default. This arrangement reduces risk for lenders and makes financing more accessible for borrowers in jurisdictions that use deeds of trust.
When should you use a Deed of Trust?
You should use a Deed of Trust when arranging financing for the purchase or refinancing of real estate in states where this instrument is recognized, such as California, Virginia, or Texas. It may also be used in private lending arrangements where parties prefer the trustee system because it typically allows for non-judicial foreclosure, which is faster and less expensive than judicial foreclosure under a traditional mortgage.
What should a Deed of Trust include?
It should clearly identify the borrower (trustor), lender (beneficiary), and trustee, along with a legal description of the property. Key terms include the loan amount, interest rate, repayment schedule, borrower covenants, and insurance requirements. It must also specify remedies in case of default, such as acceleration of the debt and the trustee’s power of sale, as well as governing law and procedures for reconveyance once the loan is repaid.
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