IMPORTO

Question 1

T/F: In order to have a valid mortgage, there must be a debt (promissory note) and a pledge of property (mortgage document)

Answer 1

True

• In order to have a valid mortgage, there must be a debt (promissory note) and a pledge of property (mortgage document)

Question 2

In a land installment contract (aka land contract):

Who is the vendor/vendee?
What role do they play?
Who is the one that holds on the the title of the property?

Answer 2

Vendor - seller, holds actual title (not just a mortgage lien)

Vendee - buyer, gets equitable title

“Seller/vendor is “vending” the land contract to the vendee”

Question 3

In a deed of trust, who is:

Trustor

Trustee

Beneficiary

Answer 3

Trustor: borrower
Trustee: neutral party who holds title
Beneficiary: Lender

“Trustor” is another name for the borrower and “trustee” is a “supposedly” neutral third party who holds naked legal title, the right to foreclose at the instructions of the beneficiary for non-payment of a promissory note.

The beneficiary is the lender in a Deed of Trust.