A California deed of trust allows a borrower to pledge their property’s title to a third party to secure a loan from a moneylender. This instrument functions similarly to a mortgage, but whereas a mortgage is an agreement between two (2) parties, the lender and borrower, the deed is between (3) parties: the lender, borrower, and a trustee. The title of the property will transfer from the trustee to the borrower when the borrower completes their repayment obligations. Often the deed will have a “power of sale clause,” which enables non-judicial foreclosure, expediting the process of recouping the lender’s loan should the borrower default.
- Statutes: Article 1. Mortgages in General
- Formatting: § 27361.5, § 27361.6 & § 27361.7
- Signing Requirements (Cal. Civ. Code § 2952): Notary Public
- Where to record (§ 1169): County Recorder’s Office
- Recording fees (§ 27361): Less than $10 for the first page; cannot exceed $3 for each page thereafter, plus an additional $75 fee at the time of recording.
Related Forms (1)
California Promissory Note – A debt repayment instrument that describes how a borrower will repay the moneylender.