When a lender advances money to the purchaser of residential or commercial real estate, two documents are executed with respect to the repayment of those funds:
The mortgage or deed of trust identifies the borrowers, and provides a legal description of the property, as well as the common street address.
At the closing, the borrower signs the mortgage, which is then recorded in the public land records, so that potential buyers can be put on notice that it exists. Once the note on a home is fully paid, the lender will file a release of mortgage.
A deed of trust accomplishes the same objective as a mortgage, but in a different way. With a mortgage, the purchaser receives a deed, subject to the mortgage. With a deed of trust, the lender holds the deed until the purchaser has made all payments, then conveys the deed to the property owner.
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