Top 5 Things to Consider When Drafting a Deed of Trust in Dallas
Crafting a legally sound deed of trust is no easy task2 min read
Crafting a legally sound deed of trust is no easy task. An experienced business attorney is essential to ensure that the deed is compliant with local regulations and appropriately reflects the goal of the parties involved. As such, those determined to draft a deed of trust in the greater Dallas area should understand the five central core considerations necessary to construct a comprehensive and enforceable deed of trust.
One of the most vital considerations when drafting a deed of trust entails the need to outline the borrower’s obligations. This includes accurate and detailed description of the terms of the loans and the payment schedule. Further, the deed should specify payment amounts on a monthly, quarterly or annual basis, as is applicable. Additionally, the deed should stipulate a late fee when applicable and possible consequences for missed or late payments.
The deed of trust should also accurately reflect the debt amount. Depending on the type of deed, this amount is subject to fluctuations. The deed should reflect and accommodate such fluctuations so that the amount secured by the deed is current and up-to-date.
The deed should also accurately reflect the qualifications of the trustee. Although the borrower, lender and trustee all have distinct roles in a deed of trust, it is the trustee’s role that is of utmost importance since this individual is mandated to take possession of the debt security should the borrower fail to meet the set conditions. As such, the trustee must be a qualified entity and their credentials and qualifications must be accurately stated in the deed.
Further, the deed should identify the title company responsible for the title report that is intended to ensure that there are no other claims or liens against the property. This title company should also be an independent and reputable entity that is licensed to conduct business in the Dallas area.
Lastly, in addition to all the foregoing considerations, the deed should outline the procedures to be followed in case of default. The deed must also acknowledge that the lender has the right to foreclose on the property and the timeline for such foreclosure.
When drafting a deed of trust in the Dallas area, it is imperative to identify and accommodate each and every one of the five considerations discussed in this article. Doing so ensures that the deed is comprehensive, compliant with local regulations and properly protective of the rights of the borrower and lender.
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