A deed of trust is the security for your loan, and it's recorded in the public records. In Colorado, delivery and acceptance is assumed when a deed is acknowledged and recorded. You can read more about the similarities and differences between a mortgage and a deed of trust, but it’s important to know which states allow you to use one or the other. While common practice was simply to quitclaim to “John Doe, Trustee of the Doe Family Trust,” there were further recording requirements lurking in the statute which were designed to provide proper notice of John Doe’s trustee relationship. While these deeds all transfer real estate titles, some offer more protection for the “grantee,” or new owner of record. Colorado recognizes several different types of deeds, which are used depending on what rights the seller can convey and the warranties that are included in the deed. Real Estate Liens, Titles, Deeds, Transfers, & Ownership Records, Colorado Real Estate Leases & Contracts (4), Real Estate Management and Ownership (17), Commercial Real Estate Laws – What Are They and How Do They Work, Title Insurance for Commercial Real Estate, Understanding the Most Common Real Estate Deeds in Colorado, Learn everything you need to know about leasing residential property in Colorado, Real Estate Liens, Titles, Deeds, Transfers & Ownership Records. Learn more about the four main deed forms and other deeds Colorado recognizes with Land Title's featured article. Colorado recognizes several different types of deeds, which are used depending on what rights the seller can convey and the warranties that are included in the deed. Beneficiary deeds are used to convey property upon the death of the owner and must be recorded prior to the grantor’s death. Senate Bill 40 allows us to go forward and correct the current state of real estate titles held by trusts and trustees, without worrying that such efforts may be useless. In Colorado the traditional method of taking title in the trustee(s) led to the problems that developed in the Lackner case. Trust deeds necessarily involve a third party- the trustee. There are not specific words that must be included, but a deed must in some way state the intent to transfer title. 7) Delivery of grantor and acceptance by grantee. Failure to satisfy these recording requirements resulted in John Doe taking title as an individual, not trustee. Copyright © 2021 Frascona, Joiner, Goodman and Greenstein, P.C.Privacy Policy and Terms of Use . Rental Application Fairness Act Compliance Packet, Residential Property Management Agreement, “Marketability Issues of Titles Held by Trusts and Trustees.”, Employer Alert: Comply with new laws that go into effect January 1, 2021, Colorado Real Estate Brokers: Protect Yourself (And Your Clients) From COVID-19 Risk, Due-on-Transfer Risk in an Era When Rates Cannot Decline, What Listing Brokers Need to Know about Disclosure of a Seller’s Security Cameras and Listening Devices. Although it is not necessary for money to change hands for property to be conveyed from one party to another, the deed must state the consideration, or value, given for the real estate. DEED OF TRUST (DUE ON TRANSFER - STRICT) Page 2 of 5 62 The insurance carrier providing the insurance shall be qualified to write Property Insurance in Colorado and shall be chosen 63 by Borrower subject to Lender's right to reject the chosen carrier for reasonable cause. This type of Trust allows the Grantor to avoid estate tax and protects their assets from creditors. Now, instead of dirt, legal documents called deeds are used to convey the title of real property from one person or entity to another. In the state of Colorado, a deed of trust must include the lender's name, the borrower's name, a description of the property, and the specific details regarding the loan used. All insurance policies and renewals thereof 6) Signature of the grantor. Colorado law provides two methods for a trust to take title to real estate: the traditional method of taking title in the name of the trustee (s), and a special statutory method of taking title in the name of the trust. Colorado Trustee Deed A trustee's deed is a form of conveyance used in trust administration and named for the person executing the deed. Traditionally trusts take title in the name of the trustee because conceptually a trust is a relationship, not an entity capable of taking title. DEED OF TRUST Required Documentation The following documentation is required to release a Deed of Trust in Colorado: this law. Deed of Trust. Choosing the right legal document is an essential part of the legal process that can have serious implications if done incorrectly. This meant that John Doe could create a renegade, legitimate chain of title superior to that of the beneficiaries of the trust. Irrevocable – The provisions established within an Irrevocable Trust cannot be altered after it has been created. Pursuant to § 38-39-102 (3), Colorado Revised Statutes, in support of this Request for Release of Deed of Trust, the undersigned, as the holder of the evidence of debt secured by the Deed of Trust described above, or a Title Insurance Company authorized to request the release of Deed of Trust pursuant to § 38-39-102(3)(c), Colorado Revised Statutes, in lieu of the production or exhibition of the original evidence … You will not become a client, and Joseph P. Stengel Jr. will not become your lawyer after any telephone consultation.You CANNOT become a client of Joseph P. Stengel Jr. unless you enter into a written engagement agreement for legal representation. 4) Statement of conveyance. The grantor (or grantors if there are more than one) must sign the deed for it to be considered valid. The new law eases the requirements for taking title in the name of the trust by providing that the trust’s title is no longer conditional upon meeting the recording requirement. A deed of trust or trust deed is similar to a mortgage. Deed of trust form Colorado is a legal form to be completed and executed by a borrower giving the legal property title to a trustee as a security for the amount lent to the borrower by a lender or beneficiary. Revocable– A Trust that can be edited at any point during the Grantor’s lifetime. This blog will explain the basic elements of a deed, as well as five common real estate deeds in Colorado. This traditional concept is modified in certain circumstances by statute or rule. A bargain and sale deed conveys property without any warranty and is generally used in the sale of court-seized properties. The grantor must be the name of the person who received the property (the grantee) on the previous deed. Colorado recognizes four primary types of deeds. WHEREAS, the above referenced Grantor(s), by Deed of Trust, conveyed certain real property described in said Deed of Trust to the Public Trustee of the County referenced above, in the State of Colorado, to be held in trust to secure the payment of the indebtedness referred to therein; and In most cases, satisfying the recording requirements now or at such time as a transaction needs to take place will be a simple matter of recording the necessary document or providing it to the title company, without the trauma that can occur if, for example, a death has occurred in the interim. A deed of trust is given as security for a debt. Title is transferred to a trustee, which is usually a trust or title company that holds the real property as security for the borrower’s loan. For that reason, it is always best to consult with a knowledgeable attorney to avoid problems and unforeseen expenses. These four main deed types consist of: General warranty deed – This deed offers the grantee protection, or … A trustee, as the grantor, uses the deed to convey real property out of a trust and vest title in the name of the grantee. House Bill Number 48 known as was approved by the Colorado General Assembly on March 5, 1894, established the office of the Public Trustee in each county of the State of Colorado and provides a system of checks and balances between the borrower and the lender. Attorneys who were knowledgeable about this problem preferred the alternative approach authorized by statute, taking title in the name of the trust. In Colorado, the customary instrument for a Lender to use in securing their collateral with real estate is a Deed of Trust (it is similar, yet somewhat different than a Mortgage). 3) Consideration. Requirements for a Release of Deed of Trust are described in Colorado Revised Statutes § 38-39-102, and must be precisely followed by the Public Trustee in the county in which the property is located. Most commonly used to transfer real estate property, a deed officially acknowledges the new owner’s possession of that property. 5) Property description. When someone finances a home, the lender secures the loan to the home by having the borrower sign either a mortgage or a deed of trust. The deed of trust labeled “Assumable-Not Due on Sale” would allow the borrower to sell the property to a new owner and keep the existing financing alive without the consent of the lender. Select the correct To have and to hold the same together with all and singular the privileges and appurtenances until the said _____ heirs and assigns forever. A deed is a legal document that allows an owner of property to transfer their right of ownership to another person. A special warranty deed is more limited than the general warranty deed, in that it guarantees against any defects to the title that arose during the time the grantor owned the property, as opposed to any title defects for the property’s entire history. Request for Release by Owner of Indebtedness WITH Production of Evidence of Debt - Form used for submission with the original cancelled evidence of debt such as a note. Such instrument shall clearly describe the mortgage or deed of trust, shall state the date to which the lien has been extended, and shall be recorded before the expiration of the fifteen-year period described in section 38-39-201 (1) in the office of the county clerk and … The holder of the deed of trust/mortgage is a corporation. With increasing frequency, real property owners are choosing to hold title in trusts. In Lackner, the recording requirements were not observed and a personal creditor of an individual who happened to be a trustee was able to levy against real property owned by the trust. The property must be described using the same legal description as is found in prior deeds. Even with the new law, there remains a small risk that a trustee may create a renegade chain of title before the recording requirements are met. _____ and State of Colorado. To be valid, the deed must specifically name the person or entity conveying the interest in the property (the grantor). The state of Colorado recognizes four main deed forms: special warranty deeds, bargain and sale deeds, and quit claim deeds. 10.2.3 Releases of Deeds of Trust — Execution by Deputy Public Trustee 10.3 Miscellaneous 10.3.1 Attachments and Levies — Release 10.3.2 Sidewalk Certificates XI. 1. Below, you can find that list. Colorado Real Estate. If a state requires it, borrowers must agree to sign the deed of trust if they want to take out a home loan, just as they would have to sign a mortgage in another state. The decision was subsequently reversed by the Supreme Court, but the case put the fear in practitioners and motivated the legislature to pass Senate Bill 40. Such concerns should be much less worrisome after Senate Bill 40 becomes effective on August 8, 2001. But there was a trap there, too. For your reference, these deeds listed below are five commonly used types of deeds in Colorado. Real estate brokers are required to use Commission approved contracts and forms as appropriate to a transaction or circumstance. he preferred method in Colorado to secure loans against real property is a deed of trust. Documents required for Releasing a Deed of Trust. Second, it allows the trustee to satisfy the recording requirements at any time after the original deed is recorded by simply recording an affidavit with the required information. When the terms of the Deed of Trust are satisfied, a request of Release of Deed of Trust must be recorded to remove the lien from the property. Colorado law provides two methods for a trust to take title to real estate: the traditional method of taking title in the name of the trustee(s), and a special statutory method of taking title in the name of the trust. Conveying title to a trustee or a trust still must be done with caution, however. 38-30-113, a deed must contain, at a minimum, these seven elements to be considered valid: 1) Written instrument. The Grantor is often the same person as the Trustee. Once you put title into a trust, you don’t want to have problems conveying title out of the trust. Historically, when real property changed ownership, the seller brought the buyer a handful of dirt from the land to symbolize that the title was transferred. As of March 31, 2020, the Jefferson County Public Trustee’s Office will no longer accept physical, paper filings for Releases of Deed of Trust Without Production. You will not become a client, and Joseph P. Stengel Jr. will not become your lawyer by reviewing or downloading any information contained in this web site.Telephone consultations are not subject to the attorney-client privilege and are offered solely for educational purposes. You also don’t want creditors of the trustee to be able to lien the property of the trust. A completed, signed, and notarized Request for a Release of Deed of Trust, available on our website. Senate Bill 40 eases the recording requirements for taking title in the name of the trustee by providing that failure to satisfy the requirements results only in a presumption that John Doe holds title as an individual. Failure to correctly state the trustee’s authority to deal in the property can result in increased transaction costs and litigation risks. Please see further instructions below on how to properly comply with this policy change. COLORADO--Single Family--Fannie Mae/Freddie Mac UNIFORM INSTRUMENT Form 3006 1/01 (page 1 of 16 pages) After Recording Return To: [Space Above This Line For Recording Data] DEED OF TRUST DEFINITIONS Words used in multiple sections of this document are defined below and other words are defined in Sections 3, 11, 13, 18, 20 and 21. Colorado Revised Statute Section 38-39-102 has set out certain requirements for releasing a Deed of Trust through the Office of the Public Trustee in the county where the property is located. The statute authorizing a trust to take title had its own recording requirements, and the statute was written in such a manner that the trust technically could not take title until the recording requirement was met. Colorado deed in trust requires a completed and signed deed of trust form. Quitclaim deeds convey only the grantor’s interest, if any, in the real estate and comes with no guarantee of the type or extent of the grantor’s interest. The request must be signed by all of the legal holders of the Promissory Note (the lender). The “Due on Transfer–Creditworthy Restriction” deed of trust requires the lender to accept a “creditworthy” buyer. For example, certain trusts are independent entities for purposes of paying income taxes or being subject to the supervisory jurisdiction of the courts. For more information on this topic, please click on the following link to the article “Marketability Issues of Titles Held by Trusts and Trustees.”. This blog will explain the basic elements of a deed, as well as five common real estate deeds in Colorado. This is an assignment of mortgage/deed of trust form where the owner of the deed of trust/mortgage conveys the owner's interest in the deed of trust/mortgage to a third party. The following documents are to be presented in San Juan County: 1. A Corporate Surety Bond CRS 38-39-102 (b) (I) equal to one and one-half times the amount of the original principal amount recited in the Deed of Trust. To boil this down to its basic message, Colorado requires specific information and procedures to ensure that real estate deeds and other documents related to real property function efficiently, and according to the intent of the named parties. (1.5) (a) Any person may record in the office of the county clerk and recorder of any county a master form mortgage or master form deed of trust. Uslegalforms.com the premiere legal forms site on the web has all the forms neccessary to handle Deed of Trust in colorado. A warranty deed gives the grantee the most protections under the law, because it guarantees the warranty of title and against encumbrances. Because of this, deeds of trusts can be preferable, especially for smaller, non-traditional lenders. ​Accessibility Statement. Legal Disclaimer: Any Information contained in this web site is not subject to the attorney-client privilege is offered solely for educational purposes. A quitclaim deed is used mostly in non-sale transactions such as transfers between spouses. DECEDENTS’ ESTATES 11.1 Transfers of Decedents’ Property, Generally 11.1.1 Release of Deed of Trust — Request for in Decedent’s Estate Problems with trusts and titles in Colorado result from statutory recording requirements which were little known and seldom followed prior to the Lackner case, which made its way up to the Colorado Supreme Court last year. Under Colorado statute C.R.S. 2) Parties designated. If you have questions about a trust or another estate planning or administration issue, please email or contact Michael Smeenk. Home » Articles » Trusts and Titles – New Colorado Law. Our firm can assist you with these issues by reviewing the current state of real estate titles held by a trust and making any corrections necessary, or by assisting you with new real estate transactions involving a trust to ensure title is obtained or conveyed correctly. A Colorado Deed of Trust is a guarantee between a lender and a borrower – while installing a trustee as an intermediary – that pledges the interest in a parcel of real property to secure the proceeds of a loan, or promissory note. Instead, the recording requirement (now a Statement of Authority instead of the previous Affidavit) can be met afterwards, for example when it is necessary pursuant to a sale or mortgage of the property. This created problems because people still actually held the title they presumed they had passed to the trust with a simple quitclaim deed to “the Doe Family Trust.”. And further that the said Trust Deed is, by these presents, to be considered as fully and absolutely released, cancelled and forever discharged. An affidavit and indemnification agreement from a title insurance company licensed and qualified to do business in the State of Colorado. Contact me today to schedule a free consultation. 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