Finance
In Delaware, what is a deed of trust used for?
ATransferring ownership of property to a trust
BSecuring a mortgage loan using the property as collateral with a trustee✓ Correct
CEstablishing a living trust for estate planning
DRecording a boundary line agreement
Explanation
A deed of trust is a security instrument used in some states (though Delaware primarily uses mortgages) where the borrower conveys title to a trustee to hold as security for a lender's loan.
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Key Terms to Know
Deed of Trust
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).
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
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