A Deed of Trust is, in its most simplistic form, an agreement between two people who utilize a piece of property, typically held by a third party in trust, as collateral until the debt between them is paid off. The trustee will be the one who oversees the property until the borrower can pay off their debt. During this process, it is the borrower who usually holds the actual title and maintains responsibility for upkeep and occupancy of the property. In the Deed of Trust, this can be altered so long as both parties agree to the terms. The trustee usually holds the legal title. A third party trust deed investment company will often hold the property in trust during this time.
Trust Deed Investment Company as a Third Party
The trustee are required to remain impartial because they may need to sell the property if the borrower fails to pay their debt as agreed. All states require the trustee to remain neutral and there are guidelines and legal codes in place to ensure the trustee doesn’t try to adjust the price of the property or affect the arrangement that has been set up. Working with a licensed and experienced trust deed investment company is a great way to ensure you are getting a fair and unbiased third party and you have someone who will assist both parties as needed during the terms of the trust deed arrangement.
What Happens After the Sale Is Complete
After the trust deed investment company completes the sale of the property, they will then use the money to fulfill the terms of the agreement put in place between the borrower and the lender. They pay the lender the amount of money required to finish paying off the debt, while the borrower will receive the remainder. In this situation, the lender can purchase the property, which would close out the debt and satisfy the agreement. Getting help from a known and trusted third party can be an easy and stress-free way to ensure there are no hidden surprises and you aren’t taken advantage of during the trust deed setup.
To learn more about how a trust deed investment company can help you, contact Mountain West IRA today!
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