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The laws of each state determine whether to use a deed of trust or a mortgage.
Assignment of rents provides added security for the lender on the note.
Typically used when financing rental property, it allows the lender to collect rent, income, and/or other profits from the property if the borrower defaults.
In that note, you promise to pay back the lender's money.
By itself, though, the note doesn't do much -- all that the lender has is your word and if you break your word, your lender would have to go through the same collection process as any other loan.
By referencing the recorded instrument information on the fictitious DOT, all rights and obligations of the parties are preserved.
Because of this, it's generally less costly to record the short form DOT.
Next, you get a notice of sale in which you're informed that your house is being sold because of your breach.
After the sale, you may get a period of time during which you can pay off the loan, but after that period ends, you have to move out.
The trustee, typically a title agency or other disinterested party, serves two purposes: to initiate the foreclosure process for the lender if the borrower defaults on the loan, and to transfer (reconvey) the property back to the borrower after the debt is paid in full.
The short form deed covers the requirements for most non-institutional lenders.