If you have too much debt and cannot afford to pay it, you might consider using a Trust Deed. These legal arrangements write off your unaffordable debt over a period of time. Trust Deeds last for 48 months, but are usually only four years long. They are managed by a Trustee, who distributes the money to creditors and retains a fee to arrange and manage the deed.
A trust deed is a legal document used in many transactions involving real estate. Generally, they are used in states such as Alaska, California, Idaho, Illinois, Mississippi, Missouri, Montana, North Carolina, Tennessee, and Texas. Because these documents are complex, it is important to hire a real estate attorney to help you make the best decision. A real estate attorney can provide you with legal advice and guide you through the process of drafting a trust deed.
A trust deed requires three parties to be named in the document. The beneficiary is the person who receives the money from the sale of the house. This person will be paid from the remaining proceeds of the sale. The trustee is responsible for the proper disbursement of the funds and the dissolution of the Trust. A trust deed has a maturity date and a set amount of time before the deed terminates and the new legal owner of the property can take possession.
In the past, Trust Deeds were only available to accredited investors. You must be an individual who has a net worth of at least $1 million or a household income of over $200,000. Currently, however, some states regulate these instruments as securities and are regulated by the Securities and Exchange Commission (SEC).
Mortgages and trust deeds are both public records and are governed by state and local laws. In the U.S., a mortgage is a contract between a borrower and a lender, whereas a trust deed is a contract between the lender and a third party. While both legal instruments are similar, trust deeds are more specific and avoid the confusion of a mortgage.
Using a trust deed is not as risky as mortgages. Foreclosures are handled by a different legal process. The process begins with a lender recording a Notice of Default and gives the borrower ninety days to correct a default. If the borrower does not correct their default, the lender will sell the property in 21 days. Unlike a mortgage, a trust deed is much quicker and cheaper.
A trust deed is an agreement between a borrower and lender where legal title to real estate is transferred to a third party, called a trustee. The trustee holds legal title to the property until the lender pays the loan. The borrower retains full responsibility for the premises and is given an equitable interest in the property. This arrangement is known as a “deed of trust”.