James is a first-time homebuyer in West Virginia reviewing his loan documents. His lender explains that the security instrument being used is standard for West Virginia. James notices that the document names him as the trustor, the bank as the beneficiary, and a title company as the trustee. Which security instrument is James signing?
Correct Answer
A) A deed of trust, which is the primary security instrument in West Virginia
West Virginia primarily uses deeds of trust rather than mortgages as the standard security instrument for real estate loans. A deed of trust involves three parties — the trustor (borrower/James), the beneficiary (lender/bank), and the trustee (neutral third party/title company) — exactly as described in the scenario. This structure is governed by the West Virginia Deed of Trust Act, W. Va. Code §§ 38-1-1 et seq.
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