A deed of trust contains three parties: The Trustor, which is you, the borrower The Trustee, which is an entity that holds "bare or legal" title The Beneficiary, which is the lenderThe deed of trust is an instrument that identifies the following:Original loan amount Legal description of the property being used as security for the mortgage Inception and maturity date of the loan Riders, if any, regarding such clauses as prepayment penalties or terms of an adjustable rate mortgage Because mortgages do not contain a trustee, many borrowers are confused between a mortgage and a deed of trust Deeds of trust contain a trustee, an independent third party that does not represent the borrower nor the lender The trustee is an entity, generally a title company, that holds the "Power of Sale" in the event of default The trustee also reconveys the property once the deed of trust is paid in full In the event of a default, the trustee files a Notice of Default; however, in most instances, the trustee will substitute another trustee to handle the foreclosure under a Substitution of Trustee After the 90-day period in the public records, and a 21-day publication period in the newspaper, the trustee then has the power to sell the property on the courthouse steps without a court procedure During the three months following recordation of the Notice of Default, the borrower can redeem the property by making up the back payments and paying the trustee's fees Once the trustee sells the property at a Trustee's sale, it is final Whereas the deed of trust is security of the debt, secured by the property, the promissory note is secured by the deed of trust and is the evidence of the debt The promissory note is a promise to pay, signed by the borrower in favor of the lender It contains the terms of the loan such as the interest rate and payment obligations The promissory note is generally not recorded When the loan is paid, the promissory note is marked "paid in full" and returned to the borrower, along with a recorded Reconveyance Deed During the term of the loan, the lender retains the promissory note Read both documents, including the pre-printed portions You might ask the closer to send you a blank deed of trust and promissory note beforehand Because preparers are human and can make mistakes, here are the important items to review:Spelling of trustors' names Interest rate (and the rider, if adjustable) If you are 30 years of age and can put $200 away a month in Trust Deed Investments, you will accumulate $1,300,000 by the time you retire at age 65 $500 a month would grow to more than $3,000,000 Trust Deed foreclosure is different than that of a mortgage foreclosure because there are no courts involved Simply put, most investors refer to trust deed foreclosure as a third party action Investors use different terms when dealing with a trust deed foreclosure The borrower is called the trustor, the lender is called the beneficiary, and the third party representative (the one who is holding the title) is called the trustee The trustee, who represents the lender or beneficiary, is brought on for the sole purpose of holding the title of the property as a security measure against the debt Because there is no court action involved, the trustee has the authority to sell the property for the beneficiary in the event the trustor fails to make his monthly mortgage payments As with any trust deed foreclosure, first the trustee will issue a Notice of Default (NOD) to the delinquent borrower and records it Usually the trustor has 90 days to cure the loan and pay all the penalties Once that time is up, they don't play Mr They will post a notice of sale on the front door of the property, the sale of the property is advertised in the newspaper to attract the biggest investors, and after a 3 week publication, the property is auctioned off on the courthouse steps The highest bidder walks away with the property Obviously, most lenders like the trust deed foreclosure process better, because they don't have to wait 6 months to even years before they can begin the foreclosure process "The Investors Complete Foreclosure Home Study Course" Discover a proven system for buying real estate foreclosures 30%, 40%, and 50% below market value Generate huge returns using this step-by-step foreclosure system Learn how you can stop the foreclosure auction and make a great deal of money doing it You'll also receive a list of Hard Money Lenders and investment groups in your area Also available from Amazon: American commercial law series Illinois, hereby releasing and waiving all rights under and by virtue of the Homestead Exemption Laws of the State of Illinois, and all right to retain possession of said premises after default in payment or a breach of any of the covenants or agreements herein contained, in trust, nevertheless, for the following purposes: bearing even date herewith, payable to the order of Now, if default be made in the payment of the said-----------Promissory Note , shall thereupon, at the option of the legal holder or holders thereof, become immediately due and payable; and on the application of the legal holder of said Promissory Note , or either of them, it shall be lawful for the said Grantee, or his successor in trust, to enter into and upon and take possession of the premises hereby granted, or any part thereof, and to collect and receive all rents, issues and profits thereof; and in his own name, or otherwise, to file a bill or bills in any court having jurisdiction thereof against the said party of the first part, Dollars attorney's and solicitor's fees, and also all other expenses of this trust, including all moneys advanced for insurance, taxes and other liens or assessments, with interest thereon at 7 per cent per annum, then to pay the principal sum of said note , whether due and payable by the terms thereof or the option of the legal holder thereof, and interest due on said note In case of the death, resignation, absence, removal from said County, or other inability to act of said Grantee It is agreed that said Grantor shall pay all costs and attorney's fees incurred or paid by said Grantee or the holder or holders of said note in any suit in which either of them shall be plaintiff or defendant, by reason of being a party to this Trust Deed, or a holder of said note , and that the same may be a lien on said premises, and may be included in any decree ordering the sale of said premises and taken out of the proceeds of any sale thereof contracts, negotiable paper, sales of personal property, agency, partnership, corporations, insurance, suretyship, debtor and creditor bankruptcy, banks and banking, property, business, law Click Here For More Information Hyperlink Text
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