Что такое Deed of Trust?

A deed of trust is a real estate financing instrument that involves three parties: the borrower (trustor), the lender (beneficiary), and a neutral third party (trustee). When a buyer takes out a home loan in a deed-of-trust state, they sign over bare legal title to the trustee, who holds it as security for the loan. The borrower retains equitable title — the right to use and enjoy the property — and the trustee holds legal title in trust until the loan is repaid in full.

The primary practical difference between a deed of trust and a traditional mortgage involves the foreclosure process. In mortgage states, foreclosure must go through the courts (judicial foreclosure), which is time-consuming and expensive. In deed-of-trust states, the trustee can foreclose through a non-judicial process (a trustee's sale or power of sale) once the lender certifies default, typically completing foreclosure in a few months rather than years. This efficiency benefits lenders and generally results in lower mortgage rates for borrowers in deed-of-trust states.

When the loan is paid off, the trustee executes a deed of reconveyance that transfers legal title back to the borrower, clearing the lien from the public record. The deed of trust itself is recorded in county land records as a lien against the property, which is why title searches will show it when a property is sold or refinanced.