Another form of security regarding real property over a debt is known as a security deed. A security deed is extremely similar to a deed of trust in that it transfers a legal title as assurance over a debt being paid. In the event that the debt goes unpaid, the title may be sold to compensate for the debt nevertheless. The different with a security deed is that it eliminates the trustee, leaving just the parties involved without bringing in a third party.
In this case, there is no trustee that holds onto the title of real property at any point in the transfer of the title to a holder, nor in the sale of it, if need be. In a security deed, the lender will hold onto a title of property as a security over the debt of the borrower while still holding the right to sell it in the instance that the debtor fails to make payments. Like the other security measures mentioned earlier, the security deed does not take away the owner’s right to that property, it simply gives them a security “interest” over that property.
For example, if a home owner takes out a loan and gives up a security deed for that debt listing his home as the real property, he can still live in that home. This does not allow the lender to come and use that person’s home or take it over. It simply grants them a right of sale of that title in the event of not being paid, otherwise does not affect the property.
So in the case that the borrower cannot pay for the debt secured by his home, then the lender can sell the title of his home. In this case then yes, the home would not belong to the original owner anymore. The amount received for the sale of the title would be used to compensate for the debt owed to the lender, and the owner would lose the home due to the matter.
In some places, a security deed is also referred to as a deed to secure debt, but being the same document in structure and entailments. In fact, most of the security measures such as a security deed or a deed of trust, share the basic similar attributes. In essence, they are based upon the same idea as to their existence, with different detailing factors involved in each one.
In fact, one thing that they all share is that they are all an encumbrance on a real property, and remain there until the debt pertaining to each one is paid for. They allow the lender to directly or indirectly exercise a right to regain the money given in a loan if a debtor themselves, is unable, or incapable of doing so. This allows a loan to be easier to access and to approve on both ends, giving one party a swift loan, and the other, a security or assurance over that loan.