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I still do not understand why I have to sign a mortgage or deed of trust on the property if I have already signed a promissory note?
The promissory note is your promise to pay the lender a certain amount of money over a specific period of time, but the mortgage or deed of trust gives the lender an actual "ownership interest" in the property. Until the loan has been paid in full, the lender will retain this ownership interest in the property for his protection. The mortgage document restates the basic information found in the note and spells out your responsibilities to pay principal and interest, taxes, insurance on time, and to maintain insurance on the property and to properly maintain the property and not allow it to fall in disrepair. Please refer to your copy of The Complete Guide to Your Real Estate Closing for further explanation.
Copyright © 2009 Sandy Gadow. This article may not be resold, reprinted, resyndicated or redistributed without the written permission from Escrow Publishing Company.
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