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California Lost Trust Deed Bond
In order to get permission for the mentioned lost deed of trust/lost note bond/lost deed of reconveyance surety bond, the application for the California Lost Trust Deed Bond/Lost Note Bond/Lost Deed of Reconveyance bond has to be filled out and signed by all vested owners and spouses.
Each request for a California Lost Trust Deed Bond has to be accompanied by its own individual application. Along with the application that has been filled out, there is a list of materials that will be required in order to underwrite the bond request. If you want to prevent delays in processing, you ought to send as many things as you possibly can.
This California Lost Trust Deed Bond is for situations in which there is a lost deed of trust, a faulty deed of trust, lost trust notes, or a lost reconveyance.
California Lost Trust Deed Bond is a bond that is needed for individuals who have lost a deed in trust and might be required by banks or other financial instrument transfer agents. In the event that the beneficiary cannot be discovered to legally complete and file a reconveyance, the bond is given to the lender in order to clear the title.
The term reconveyance refers to the process by which the title to the real estate is given back to the borrower once the secured obligation has been paid in full by the trustee.
Purpose
California Lost Trust Deed Bond is a surety bond that must be purchased by a bank or any other financial agency in order to correctly re-convey an open note that may be detected on a preliminary title report. When the beneficiary of a trust deed cannot be discovered to sign and submit a reconveyance, the lender will ask for a California Lost Trust Deed Bond from the borrower in order to clear the title to the real estate that is subject to the trust deed.
When the secured loan is completely paid off, the process known as reconveyance occurs. This is when the title to the real estate is transferred from the trustee back to the borrower. In most cases, the bond must be registered with the county clerk or recorder in the county in which the property is situated.
The tenure of the bond is for a period of three years, and it is not renewable. According to Section 2941 of the California Civil Code, a bond may be required for any of the following reasons:
- When the property report indicates that a certain quantity is still owed on the property and the mortgagor, trustee, or successor is unable (after making reasonable efforts) to trace the mortgagee or beneficiary of record, the lien placed by any deed of trust must be removed.
- When the debt that was secured by a mortgage or deed of trust has been completely paid off, but the current mortgagee or beneficiary of record cannot be found despite an intensive search.
- When the original beneficiary fails or refuses to sign and produce a valid certificate of discharge or request for reconveyance.
Bond Amount
The amount of the California Lost Trust Deed Bond must be equal to the greater of either (1) two times the amount of the original obligation that was covered by the mortgage or deed of trust and any extra principal amounts, including advances, stated in any recorded amendment thereto (the most common), or (2) the amount of the original obligation that was secured by the mortgage or deed of trust plus any further principal amounts, including advances.
(2) one-half of the total amount computed in accordance with (1) as well as any interest that has accrued on such amount, and shall be conditioned for payment of any sum which the mortgagee or beneficiary may recover in an action on the obligation which is secured by the mortgage or deed of trust, along with the costs of suit and reasonable attorneys’ fees.
The mortgagee (the lender of the deed in question) or mortgagee’s successor in interest, the trustee who executes a reconveyance under this section (typically the title insurance company), and the beneficiary or beneficiary’s successor in interest are the obligees (parties protected by the bond) under the bond. Other obligees include the beneficiary or beneficiary’s successor in interest.