• Brokers originating loans on behalf of themselves and their real estate investors

A private investor's trust deed, often referred to simply as a "trust deed" or "deed of trust," is a legal document used in real estate transactions to secure a loan on behalf of a private lender or investor. It involves three parties:

1. The Trustor (Borrower): The individual or entity that borrows money and offers their property as collateral.

2. The Beneficiary (Lender): The private investor or lender who provides the loan to the borrower.

3. The Trustee: A neutral third party who holds the legal title to the property in trust until the loan is repaid.

Owner financing, also known as seller carry-back, is gaining popularity as a creative option where the seller provides a loan to the buyer. In many cases, involving a neutral third-party loan servicer benefits both the borrower and lender.

A trust company is a financial institution that acts as a fiduciary, agent, or trustee on behalf of an individual or business for the purpose of administration, management, and eventual transfer of assets. In the context of a trust deed:

• Trustee Role: Trust companies often serve as the trustee in a trust deed arrangement. They hold the legal title to the property on behalf of the lender (beneficiary) until the loan is repaid. If the borrower defaults, the trust company, as the trustee, has the legal authority to initiate and carry out the foreclosure process to recover the debt.

• Neutral Party: Trust companies are typically neutral and ensure that the trust deed is administered according to the terms of the loan agreement. They protect the interests of both the lender and the borrower by ensuring that the foreclosure process, if necessary, is conducted fairly and in compliance with applicable laws.