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Deed of Trust
THIS DEED OF TRUST (the "Trust") dated this 9th day of December, 2019
BETWEEN:
_________________________ of ________________________________________(the "Trustor")
OF THE FIRST PART
- AND -
_________________________ of ________________________________________(the "Beneficiary")
OF THE SECOND PART
_________________________ of ________________________________________(the "Trustee")
OF THE THIRD PART
BackgroundA. The Trustor, being registered as owner of the estate in the following described property (the "Property") located at ________________________________________ in ____________________, Commonwealth of Virginia, United States with the following legal description:____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________B. Any buildings or structures on the Property and anything now or later attached or fixed to the buildings or the Property including additions, alterations and improvements located on, above or below the surface of the Property are covered by this Trust. However, no additions, alterations or improvements will be made by the Trustor without the Beneficiary's prior written consent. Any addition, alteration or improvement will be subject to all recorded easements, rights of way, conditions, encumbrances and limitations, and to all applicable building and use restrictions, zoning laws and ordinances, if any, affecting the Property.IN CONSIDERATION OF the sum lent to the Trustor by the Beneficiary, in the amount of $_______________ U.S. DOLLARS (the "Principal Amount") the receipt of which the Trustor does hereby acknowledges itself indebted, the parties to this Trust agree as follows:
MATTERS RELATING TO PAYMENT
DEFAULT AND REMEDIES
MISCELLANEOUS MATTERS
IN WITNESS WHEREOF the Trustor, has duly affixed his or her signature under hand and seal on this 9th day of December, 2019
__________________________________________________(Trustor)
Trustor Acknowledgment
A Deed of Trust, also known as a trust deed, is used to secure a loan for real property (immovable property like land or a house). When using a trust deed, legal title to a property is transferred from the lender to a neutral trustee until the borrower pays off the loan. Once repayment is complete, the legal title transfers from the trustee to the borrower, and the transaction is complete.
One of the main differences between a Mortgage Agreement and a Deed of Trust is the parties who are involved in the transaction.
A Mortgage Agreement has two parties:
A Deed of Trust has three parties:
A trust deed can also include a guarantor, a person who is jointly responsible for the loan repayment if the trustor defaults. This provides extra security for the lender because they'll have another avenue to collect on the loan if needed.
Another difference is that a Deed of Trust always has a power of sale clause that grants the beneficiary the right to foreclose on the property should the trustor default. In this event, the trustee will conduct a non-judicial foreclosure (a sale of the property without the requirement of a court order).
Some states require the use of a specific security instrument, meaning a Deed of Trust or a Mortgage Agreement.
Idaho and Washington, D.C. require the use of a trust deed.
Connecticut, Delaware, Florida, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Nebraska, New Jersey, New Mexico, North Dakota, Ohio, Pennsylvania, and South Carolina require the use of a Mortgage Agreement.
The rest of the states may use one or the other.
In a Deed of Trust, the trustee is a neutral third-party who holds the legal title of the property as security for the loan until the lender's money is repaid or the borrower defaults.
Trustees are sometimes referred to as escrow agents. Escrow is the process of a third-party securing a transaction (in the case of the sale of real estate, they are holding the title of the property until the loan agreement is satisfied or dissolved). Usually the escrow agent (trustee) is an attorney or a title company. A title company ensures that the title to real estate is legitimate, and they insure the property. Title insurance shields the lender and borrower from potential lawsuits that arise from disputes over the title.
To fill out this trust deed, you'll need the following information:
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