A deed of trust used as a security instrument differs from a mortgage in that:
Why A deed of trust involves three parties (borrower, trustee, lender) and allows non-judicial foreclosure in some states Is Correct
Answer B: A deed of trust involves three parties (borrower, trustee, lender) and allows non-judicial foreclosure in some states
Exam Tip: Property Ownership
Property ownership questions test the bundle of rights and different forms of ownership. Know the differences between joint tenancy, tenancy in common, and community property, including the right of survivorship.
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Key Terms to Know
A security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
DeedA written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Short SaleA sale of real property where the sale proceeds are less than the outstanding mortgage balance, requiring lender approval.
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