Waco Title Insurance Practice Test

In a deed of trust, the grantor is the borrower taking out the loan. This is because the grantor is the party that conveys the property interest in the deed of trust, which is typically used in real estate transactions to secure a loan. By signing the deed of trust, the borrower (grantor) grants a security interest in the property to the lender. The property serves as collateral for the loan, and this arrangement provides the lender a way to recoup the loan amount if the borrower defaults.

The other parties involved, such as the lender, title company, and witness, serve different functions. The lender is the beneficiary of the trust, receiving the security interest in the property. The title company is responsible for ensuring that the title is clear and handling the administrative aspects of the transaction. The witness provides certification to the agreement but does not hold an interest in the property being transferred. Understanding the roles of each party in the deed of trust is key to comprehending how real estate financing works.