Colorado State Real Estate Practice Exam 2026 - Free Real Estate Practice Questions and Study Guide

In a Deed of Trust, the trustor is the borrower. This person is the individual or entity that takes out the loan and offers their property as collateral to secure that loan. The Deed of Trust is a legal document that involves three parties: the trustor (borrower), the trustee (an impartial third party), and the beneficiary (the lender).

The trustor conveys an interest in the property to the trustee for the benefit of the beneficiary. This arrangement allows the lender to have a legal claim on the property if the borrower defaults on the loan, while maintaining the borrower's ability to continue using the property.

Understanding the roles of each party is crucial in real estate transactions, especially when it comes to financing, as it helps clarify who holds which responsibilities and rights in the arrangement.