In California, real estate loans are typically secured by a deed of trust rather than a mortgage. Which three parties are involved in a California deed of trust?
Correct Answer
D) Trustor, trustee, and beneficiary
In California's deed of trust, the trustor is the borrower who conveys bare legal title, the trustee is the neutral third party who holds bare legal title as security, and the beneficiary is the lender who benefits from the security arrangement.
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Related Concepts
Foreclosure is the legal process by which a lender takes possession of a property when a borrower fails to make mortgage payments. It allows the lender to sell the property to recover the outstanding debt.
The loan-to-value ratio (LTV) is the percentage of a property's appraised value or purchase price (whichever is lower) that is being financed through a mortgage. LTV = Loan Amount / Property Value.
A comparison of the major mortgage loan types—conventional, FHA, VA, and USDA—covering their eligibility requirements, down payment amounts, mortgage insurance rules, and best use cases.
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