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Unformatted text preview: ounty in which the firm does business. It is “fictitious” in the sense that it does not cite a specific property. Only the front side of subsequent “actual” trust deeds need be recorded, showing names, property data, and other variables. The borrower agrees to all of the terms printed on the back of the trust deed, terms recorded in the earlier fictitious deed of trust. This procedure saves in fees, records space, and unnecessary duplication. • Dynasty School (www.dynastySchool.com) 8-11 REAL ESTATE FINANCE
The reverse side of the actual trust deed contains a reprint of the standard provisions, for easy reference by the trustor or others. • Priority – The earliest recording date makes it a first trust deed, unless it contains a subordination clause, by which the beneficiary agrees to move to a junior position if another trust deed (usually a construction loan) is recorded at a later date. RELATION OF TRUST DEED TO NOTE
The lien of a trust deed or mortgage used as a security device to assure the payment of debt, by using title to real property as security, is a mere incident of the debt. Without the debt, there is no lien. Validity – if the note is unenforceable, the mortgage or trust deed gives it no validity. Obligation – The note and the mortgage or trust deed are to be construed together; therefore, a clause in either obligates the other. Conflict in Terms – If any conflict exists between the provisions of the note and the mortgage or trust deed, the note will take priority. Assignment – In case of assignment, the note and the security device (mortgage or trust deed) must go together. They cannot be assigned independently. Release –The lien is released by reconveyance of the title from the trustee to the trustor by recording of a deed of reconveyance. Request for Reconveyance – When the obligation secured by any deed of trust has been satisfied, the beneficiary must deliver to the trustee the original note, the deed of trust, and a request for full reconveyance. DEED OF RECONVEYANCE
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This note was uploaded on 12/30/2010 for the course SOC 101 taught by Professor Zhung during the Spring '10 term at Punjab Engineering College.
- Spring '10