A Nevada real estate agent is advising a buyer who is concerned about what happens to the deed of trust if the property is sold before the loan is paid off. Under standard Nevada deed of trust practice, what typically happens to the existing deed of trust when a property is sold?
Correct Answer
D) The existing deed of trust is paid off from the sale proceeds at closing, and the trustee records a deed of reconveyance to release the lien
In the vast majority of Nevada real estate transactions, when a property is sold, the existing deed of trust loan is paid off from the sale proceeds at closing through the escrow process. Once the loan is paid in full, the beneficiary (lender) instructs the trustee to record a deed of reconveyance, which releases the lien and clears the title for the new buyer. This is the standard closing procedure governed by NRS Chapters 107 and 645A.
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