In real estate, who is the party receiving the benefits of the trust deed?

In real estate, the beneficiary is the party who receives the benefits of the trust deed. A trust deed serves as a security instrument, which creates a lien against the property being financed. In this arrangement, the beneficiary is typically the lender or the financial institution that extends the loan to the trustor for the purchase of the property. The beneficiary has the right to be repaid upon fulfillment of the loan terms and has a secured interest in the property until the loan is fully paid off.

The trustor, who is the borrower, conveys the property to the trustee (often a third party) to hold on behalf of the beneficiary. The trustee acts on behalf of both the trustor and beneficiary, ensuring that the terms of the trust deed are met. The mortgagor is more commonly associated with a mortgage agreement rather than a trust deed, which is a slightly different financing arrangement. In a mortgage, the mortgagor retains ownership of the property while granting the lender a lien. Understanding these roles is essential for grasping how trust deeds operate in real estate transactions.