What is an Assignment of Trust Deed?

By Tom Streissguth

If you own a home, you may have signed a trust deed that gives the mortgage lender a claim on the property. A default on the loan gives the lender the legal authority to foreclose on the loan and take possession of the house. An assignment of a trust deed conveys that claim to another party.


Lenders have the right to sell their home loans. This can happen once or several times over the long life of a mortgage. The usual customers for mortgages are banks and other companies that are seeking safe and stable investment returns. This "secondary" market for mortgages is quite active, and a lender has plenty of opportunity to sell a mortgage and turn a profit.


When a lender sells the loan, it assigns the trust deed to the buyer. “Assignment” means to convey a claim or a right to another party, known as the “assignee.” This is done by creating another legal document — the assignment of trust deed — and having it signed by both buyer and seller. The trust deed, and other documents associated with the loan, become the property of the buyer.

Ready to start your LLC? Start an LLC Online Now


The assignment of trust deed is a short, usually single-page document. The body text gives the names of the deed buyer and the property owner, the date of the original trust deed, and the legal description of the property for which the original deed was executed. It may also give the terms of the deed sale. The seller signs and dates the document, and has it notarized. The buyer then has the assignment of trust deed recorded with the registrar of the county where the property is located.


A borrower has no legal right to block or negotiate the terms of an assignment of trust deed. The assignment does not affect the terms of the loan. The monthly payments remain the same, although the borrower will have to send them to a new address. The new owner of the trust deed becomes the lender and collects all mortgage payments, sometimes on its own and sometimes through a servicing company. If a default occurs, the latest assignee has the right to foreclose and repossess the home.

Ready to start your LLC? Start an LLC Online Now
Texas Deed of Trust Laws


Related articles

How to Remove a Lien After Chapter 13 Discharge in Florida

Floridians who wish to hold on to valuable assets, such as the family home, often choose to file for Chapter 13 bankruptcy when they find themselves drowning in debt. They get to keep their property while paying some or all of their debt over an extended period of time. If a property has multiple liens on it, Chapter 13 can even strip these liens from the property. As long as a debtor successfully completes his payment plan, creditors typically release the liens automatically when the bankruptcy is discharged.

Contract for Deed Pros & Cons

A contract for deed is a written contract between a potential seller and buyer agreeing to a future conveyance of property once terms and conditions of the contract have been met. A contract for deed is often referred to as an installment sale agreement, land contract or owner financing. Unlike a typical real estate purchase agreement, the buyer usually takes possession of the property upon execution of the contract and makes payments until the agreed-upon price has been paid in full, at which time the property is usually deeded to the purchaser.

How to Write a Deed With Power of Attorney

A real estate deed is a document representing legal ownership of a parcel of real estate. To transfer ownership of real estate, a new deed must be drawn up in favor of the purchaser or grantee. Normally, the seller, or grantor, must sign the new deed to transfer ownership. However, it is possible for a third party to execute a valid signature on a real estate deed, as long as the seller, or grantor, has executed an appropriately-worded power of attorney authorizing an agent to do so.

LLCs, Corporations, Patents, Attorney Help

Related articles

What Is a Deed of Trust With Assignment of Rents?

Some states refer to a voluntary lien against real property in exchange for money as a mortgage, while others refer to ...

Title Vs. Deed of Trust

The words "title" and "deed of trust" are often used in real estate. If you're buying a home, both these are used -- ...

What Is a Second Trust Deed?

A deed of trust is similar to a mortgage, allowing a borrower to secure a loan to buy a house by using the house as ...

What Happens If I Inherit Property With a Mortgage?

Inheriting a home can become a troublesome financial burden, especially if the home comes with a mortgage. Under ...

Browse by category
Ready to Begin? GET STARTED