Contracts

What is a 'for the purchase price' clause in a Nevada deed of trust?

AA clause specifying the interest rate on the loan

BA recitation in the deed of trust stating the amount of the obligation being secured✓ Correct

CA clause determining how the purchase price is paid at closing

DA clause requiring the seller to guarantee the property's value

Explanation

A deed of trust typically identifies the amount of the underlying obligation being secured. This is important for establishing the lender's priority position and the amount that must be paid to release the lien (reconveyance) when the debt is satisfied.

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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.

Lien

A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.

Deed

A written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).

Contingency

A condition in a purchase contract that must be satisfied before the sale can proceed to closing.