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Deed of Trust/Mortgage
A deed of trust or mortgage is one of several documents signed at a loan closing. It contains three parties; the trustor or borrower, the trustee (which is the entity that holds legal title) and the beneficiary (which is the financial institution loaning the money). The deed of trust states the original loan amount, the legal description of the property, the maturity date of the loan, provisions of the loan and any riders that apply. Borrowers must initial each page of this document and sign their names on the last page. The notary must notarize this document in order for it to be a legal binding agreement.
The mortgagor's affidavit is a document used to insure the loan. It states the borrower's intentions for the home; whether or not she will live there and whether it is her primary residence. This document also states whether the property is in a special flood hazard area. The mortgagor's affidavit is used by the Federal Housing Administration, the Veterans Administration or a Private Mortgage Insurance Company. This document also verifies the that borrower's financial
situation has not changed in any way nor has the property changed significantly.
The subordination agreement is a written contract which states that the lender agrees to subordinate the loan to a new loan. This means that in the event of foreclosure, this loan would be paid off first before any other loans or liens against the property, including any second mortgages or loans placed on the property after the inception of the original loan. This document is recorded in the official county records in the county where the property is located.
The borrower's affidavit is a document in which the borrower testifies he is not involved in a divorce, bankruptcy or any other major event that could jeopardize the approval of the loan in any way. The borrower also certifies, by signing this document, that he has not done anything to affect the title of the property. The notary must witness the signing of this document in order for it to be a legally binding document. By witnessing the borrower signing the document, the notary is only attesting that this is indeed the borrower's signature.