Trust Deed

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DEFINITION of 'Trust Deed'

1. A formal document which outlines the terms of a trust agreement.

2. A common way to structure real estate purchases, where the title to a property is held in trust until the loan for the property is paid.

BREAKING DOWN 'Trust Deed'

1. A trust deed is often used when mutual funds are set up as a trust. Information that may be documented includes the powers of the trustee and any restrictions on investment vehicles.

2. Used to add security to a property purchase, the trustee does not get involved in the agreement unless there is a default on the loan, at which time the trustee would sell the property.

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