A California borrower with an FHA loan secured by a deed of trust wants to refinance with a new conventional loan. The existing FHA lender must be paid off and the deed of trust released. In California, what document does the trustee execute to release the security interest?
Correct Answer
C) A deed of reconveyance transferring bare legal title back to the trustor
In California, when a deed of trust is paid in full, the trustee executes a deed of reconveyance, which transfers bare legal title from the trustee back to the trustor (borrower). This is the standard method of releasing a deed of trust lien in California.
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