In Virginia, which instrument is recorded in the land records to secure a real estate loan, and how many parties does it involve?
Correct Answer
D) A deed of trust, involving three parties: the trustor, the trustee, and the beneficiary
Virginia exclusively uses a deed of trust as its primary security instrument for real estate loans. The deed of trust involves three parties: the trustor (borrower), the trustee (a neutral third party who holds legal title), and the beneficiary (the lender). This three-party structure is a defining feature of Virginia real estate finance and is heavily tested on the state exam.
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Related Topics & Key Terms
Key Terms:
Related Concepts
TILA is a federal law that requires lenders to disclose the true cost of credit to borrowers, including the annual percentage rate (APR), total finance charges, and loan terms. It is implemented by Regulation Z.
A trustee sale is a type of foreclosure where a trustee, appointed under a deed of trust, sells the property at auction to satisfy the debt.
Usury is the practice of charging an interest rate that exceeds the maximum rate permitted by state law. Usury laws protect borrowers from excessive interest charges on loans.
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