WHAT IS A TRUSTEE?
WHAT IS A TRUSTEE?
Borrowers are often confused about mortgages and deeds of trust because of the inclusion of an independent third party called a trustee. This party does not represent the lender or the borrower. The trustee does however fulfill a number of important roles in a deed of trust, and has specific authority.
Below is a description the trustee’s various duties:
• Trustees are typically title companies or other business entities that are given the “Power of Sale” if the borrower happens to default on a loan.
• The trustee is responsible for returning the property, once the deed of trust is paid in full.
• If you happen to default on your loan, the trustee will file what is called a “Notice of Default.” In most cases, the trustee will have another trustee come in to deal with the foreclosure proceedings, under the terms of the “Substitution of Trustee.”
• Once the 90-day period in the public records and the 21-day publication period in the newspaper have elapsed, the trustee is authorized to sell the property in public (even on the courthouse steps) without further legal proceedings.
• 90 days (or three months) after a Notice of Default has been recorded, the borrower can actually make an attempt to redeem the property, by paying the trustee’s fees and paying back payments.
• If a trustee sells a property at a Trustee’s sale, the sale is final and legally binding.
