Assignment of Deed of Trust or Mortgage

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Mortgage Assignment - How Real Estate Investors Profit

Mortgage assignment is a common practice among lenders. A mortgage deed, also called a deed of trust or trustee's deed or deed of trustee, gives a lender a security interest in the property mortgaged in return for money received. Lenders and mortgagors of deeds of trust often sell mortgages to third parties, like other lenders. If a trustee is assigning beneficial interest under a deed of trust, it should be recorded in writing. Mortgage assignment is a document that indicates that such an assignment of contract has happened. Once an assignment is recorded, a new lender stands in the shoes of the original lender.

Although a lender is not required to inform a borrower prior to mortgage assignment, s/he must send a notification after a mortgage sale has taken place informing the borrower how to make mortgage payments in the future. The borrower can negotiate mortgage terms with the new lender and seek mortgage modification.

A mortgage deed refers to a deed accompanied by a mortgaged loan note. Every mortgage deed involves two steps: a promissory note and a mortgage. A note has details like amount owed, term of loan, etc. and is proof of existence of a mortgage. The mortgage is the means through which a borrower pledges or mortgages property as security for money received. The note and mortgage are two sides of the same coin and are inseparable. A mortgage follows the note and thus assignment of mortgage note results in assignment of a mortgage. In other words, a mortgage cannot be assigned without transferring the note. Therefore, assignment of note and mortgage happen simultaneously.

Mortgage assignments are beneficial to both home sellers as well as buyers. For home sellers it can be an easy way to sell a home that has been on the market a long time. The benefit for home buyers is that they can buy a house without going through the process of qualifying for a bank loan and making a large down payment. There are many real estate companies offering attractive assignment programs that benefit sellers and buyers alike. Using the benefits of such a home mortgage assignment program will help you sell your home quickly or buy a home without dealing with bank formalities.

Once a mortgage has been transferred, it means that obligation of loan has transferred. In order to validly assign a mortgage, a mortgage assignment document should have the following details:

  • description of the real estate so that there is clarity about the property

  • the name of the original party as well as the third party

  • contact information

  • the date when the mortgage assignment became valid


Assignment of mortgage should be recorded before the government authority that deals with property ownership, property taxes, etc. If you are a borrower and you receive a notice that your mortgage has been transferred to another lender, you should get in touch with your lender and confirm it. You should also secure details of the person to whom the mortgage was sold to.

If you are a new lender and do not have a valid mortgage assignment document, you will be disadvantaged if you have to move for foreclosure. In the event mortgage payments stop, you may want to move the local court for foreclosure and take ownership of the property mortgaged. If there was no legal document created when you assign a mortgage, you will have no right to file for foreclosure. Therefore, it is important to document when you assign a mortgage. Click here to view our sample mortgage assignment form, also referred to as an assignment of mortgage form or mortgage assignment letter.

One drawback of mortgage assignment is that it all depends on a third party. For many, getting mortgages assigned is a kind of real estate investing practice. The third party to whom the mortgage is assigned to is a real estate investor who reaps the benefits of one of the party's desperateness. The investor third party is only concerned about reaping mortgage assignment profit from the mortgage assignment investing deal s/he has entered into and has no regard for the financial well being of the parties involved.

Mortgage Assignment FAQs

What is mortgage assignment?

Mortgage assignment, also called assignment of trustee's deed or assignment of deed of trustee, is the process of selling an existing mortgage to a third party. The borrower gets notice to make mortgage payments after the date of assignment of the mortgage deed to the new mortgagee. A mortgage assignment form satisfies lawful conveyance of the mortgage. An assignment of mortgage form also signifies that an assignment of contract has occurred and mortgage has been transferred.

Who can assign a mortgage?

A mortgage holder or a borrower can assign the mortgage to a third party. A lender can also assign a mortgage to another lender. In some cases, a homeowner can engage in assignment of mortgage, but the lender must give permission.

What are my benefits if I engage in HUD mortgage assignment program?

Homeowners can avoid foreclosure and can refinance their mortgage with the help of a mortgage assignment program offered by the U.S. Department of Housing & Urban development (HUD). In a real estate investing business, mortgage assignment program helps a real estate investor to sell his/her home really quickly.

What are the drawbacks of mortgage assignments?

There are a few drawbacks to assignment of a mortgage that you should be aware of. In case the buyer defaults on payments, you might have trouble collecting. Another disadvantage is that mortgage assignment depends on a third party-the new buyer, who is only concerned about getting mortgage assignment profit from a mortgage assignment deal.

Can you explain the process of mortgage assignment?

It is always advisable to utilize the services of a professional realtor or investor in the mortgage assignment investing business. Once you assign such a firm the task of mortgage assignment by signing a sales contract, they will do all the paperwork necessary for a mortgage assignment program. You will be required to submit additional documents related to the mortgage in order to assign the mortgage. The mortgage will then be advertised. Once a buyer is located, your realtor will require you to sign remaining paperwork and will prepare closing documents.

Documents required for a mortgage assignment are:

  • loan details including loan number, loan type and terms of loan

  • an authorization to discharge Loan Information

  • purchase contract and addendum to contract identifying conditions of mortgage assignment

  • seller's disclosure document

  • mortgage assignment letter

  • document assigning insurance contract

  • an acknowledgement document by seller

  • mortgage modifications, if any

Top Questions about Assignment Of Deed Of Trust Or Mortgage

  • What is an assignment of a mortgage document?

    An assignment of a mortgage document is a legal instrument that transfers a mortgage from one lender to another. This document includes details about the original mortgage and the parties involved in the transfer. Understanding this concept helps borrowers recognize who they should communicate with regarding their mortgage obligations. Resources on US Legal Forms provide clarity on the Assignment of Deed of Trust or Mortgage and guide you through the necessary steps.

  • What happens if the assignment of mortgage is not recorded?

    If the assignment of mortgage is not recorded, it may lead to legal complications, including disputes over ownership and rights to the property. Unrecorded assignments can hinder enforcement of mortgage terms and might affect the ability to foreclose. For clarity and to protect your interests, ensure that all assignments are properly recorded, and consider using services like USLegalForms to simplify the process.

  • What is the difference between mortgage and assignment?

    The main difference between a mortgage and an assignment is that a mortgage involves borrowing funds secured against property, while an assignment refers to the transfer of rights under that mortgage from one party to another. An assignment can occur when a mortgage is sold or transferred to a new lender. Grasping these concepts is essential for anyone engaged in property transactions.

  • How do I release an assignment of a mortgage?

    To release an assignment of a mortgage, you generally need to complete and file a formal document called a release or discharge with the appropriate county recorder's office. This document confirms that the mortgage has been satisfied and removes the lien from the property. It’s advisable to check local laws and consider using platforms like USLegalForms for assistance with the necessary paperwork to ensure compliance.

  • Can you assume a mortgage in a trust?

    Yes, you can assume a mortgage in a trust, but certain conditions must be met. The lender must be notified, and they may require a credit check or approval process for the trust to take over the mortgage payments. It's crucial to understand the implications of such an action, and resources like US Legal Forms can assist you in navigating the Assignment of Deed of Trust or Mortgage effectively.

  • How do I complete an assignment of mortgage?

    Completing an assignment of mortgage involves several essential steps. First, you need to gather the necessary documents, including the original mortgage agreement and trust documents. After preparing an assignment form, you will submit it for recording to your county office, ensuring the Assignment of Deed of Trust or Mortgage is official and legally binding.

  • Can you assign a mortgage to a trust?

    Yes, you can assign a mortgage to a trust, but it requires careful attention to legal details. This process involves identifying the trust as the new holder of the mortgage, thereby allowing it to benefit from the asset. Engaging with professionals and utilizing resources like US Legal Forms can help streamline the Assignment of Deed of Trust or Mortgage, ensuring you follow proper procedures.

  • How do you assign a mortgage to a trust?

    To assign a mortgage to a trust, you must first review the trust documents to ensure they permit such an assignment. You typically need to fill out an assignment of mortgage form, which outlines the transfer to the trust. Once completed, you must send the document to the lender for approval and to update their records accordingly, facilitating the Assignment of Deed of Trust or Mortgage process.

  • Why do people put their mortgage in a trust?

    People often put their mortgage in a trust to manage their assets more effectively and ensure a smoother transfer of wealth. By using a trust, individuals can potentially protect their property from probate, reduce estate taxes, and provide instructions for their assets after death. This process is often referred to as the Assignment of Deed of Trust or Mortgage, allowing for clear guidance on asset distribution.

  • What happens if a mortgage is not recorded?

    If a mortgage is not recorded, it may create complications regarding ownership and rights. Unrecorded mortgages can lead to disputes, as other claims to the property might emerge. This increases risks for both lenders and borrowers regarding the assignment of deed of trust or mortgage. Using uslegalforms can help ensure proper recording to avoid such issues.

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