Mortgage Agreement for Virginia


_____________, _____________ _____________


_____________, _____________ _____________


_____________, _____________ _____________


COUNTY OF _____________
STATE OF _____________

THIS DEED OF TRUST (hereinafter referred to as the "Security Agreement") is executed on _____________ by and between the following parties (hereinafter the "Parties"):

BORROWER (hereinafter "Borrower"):

LENDER (hereinafter "Lender"):

TRUSTEE (hereinafter "Trustee"):

  1. GRANT IN TRUST. For and in consideration of (hereinafter referred to as the "Loan Principal"), lent by Lender to Borrower, Borrower hereby grants, transfers, and coveys IN TRUST, WITH POWER OF SALE to Trustee, all rights, title, and interest that Borrower has now or may hereafter acquire in the following described real property (hereinafter the "Property") together with all buildings, fixtures, and improvements now or hereafter existing thereon:

      _____________, _____________ County, _____________ _____________
  2. PURPOSE. This Security Agreement is created for the purpose of securing for Lender repayment of the note executed between Borrower and Lender on _____________ (hereinafter referred to as the "Promissory Note") by Borrower, including all renewals, extensions, and modifications of the Promissory Note, as well as to secure Borrower's full performance of the covenants and obligations undertaken in this Security Agreement and the Promissory Note. Borrower warrants that a security interest on the Property may be perfected under the Uniform Commercial Code and to execute any additional instruments required to perfect or renew perfection of Lender's security interests specified herein.
  3. PROMISSORY NOTE TERMS. The Promissory Note contains the following terms of repayment: _____________ This section is for reference purposes only, and in all cases, the terms of the Promissory Note shall control over this Security Agreement.
  4. BORROWER REPRESENTATIONS AND COVENANTS. Borrower represents that it is the legal owner of the Property and has the right to grant, transfer, and convey the Property in trust. Borrower warrants that, at Borrower's own expense, Borrower will defend title to the Property against all lawful claims. Borrower warrants that Lender shall have the right to participate in all actions against the title that Borrower is named in and that Borrower will execute any instrument and take all other actions necessary to assist Lender's participation.
  5. REPAYMENT. Borrower promises to repay Lender the Loan Principal, together with all interest, fees, charges, Escrow Funds, and other costs associated with this Security Agreement, including any amendment, extension, or renewal thereof, at the location and according to the terms specified in the Promissory Note and according to any other related documents executed between the Parties that correspond to this Security Agreement. Borrower promises to make all payments due without abatement, set-off, or counterclaim, and any claims made by Borrower against Lender shall not reduce or postpone Borrower's obligation to pay hereunder.
    1. PARTIAL PAYMENT. Lender may choose to accept a partial payment on the loan described in the Promissory Note without waiving any rights hereunder, including the right to refuse partial payments at a future date. Lender may choose when a partial payment is to be applied to the outstanding balance.
  6. ESCROW CHARGES. On the day each periodic payment becomes due to Lender under the Promissory Note and until the Promissory Note is repaid in full, Borrower shall include with each payment monies to pay for the following "Escrow Charges":
    1. Any amounts owed on the Property which can have priority over this Security Agreement, including without limitation, taxes, assessments, fees, Homeowners' Association dues, liens, judgments, encumbrances, and similar charges;
    2. Any lease or rental payments that may become due on the Property or its fixtures;
    3. Any premiums and insurance charges required by Lender; and
    4. Any fees or costs associated with the Property or the trust created herein.
    1. PAYMENT OF ESCROW CHARGES. Borrower shall provide Lender notice of all Escrow Charges that become due and shall pay all Escrow Charges prior to their becoming delinquent. Should Borrower fail to pay Escrow Charges, Lender may choose to make a past-due payment on Borrower's behalf, and Borrower will then be obligated to repay Lender for such payment, including any fees or costs associated.
    2. PRIORITY LIENS. Borrower agrees to discharge all liens which can have priority over this Security Agreement unless one of the following apply: (a) Borrower forms an agreement with the lien holder acceptable to Lender that subordinates the lien to this Security Agreement; (b) Borrower initiates legal proceedings to contest the lien in good faith such that the lien will not be enforced while being contested, and Borrower promises to discharge the lien if it receives an adverse ruling; and (c) Lender gives prior written permission for Borrower to discharge such lien in another manner. If Lender so chooses, Borrower must pay a fee for Lender's use of a real estate reporting service to determine the status of the property. Should Lender discover an outstanding lien that can obtain priority over this Security Agreement, Lender may choose to notify and require Borrower to discharge the lien or pursue the options specified in this paragraph in order to resolve the matter.
    3. RECEIPTS. Lender may require that Borrower provide Lender receipts or other evidence of payment of Escrow Charges upon Lender's request.
    4. WAIVER OF ESCROW ITEM OBLIGATIONS. Lender may provide written waiver to Borrower waiving Borrower's obligation to pay Lender for any or all Escrow Charges, and Borrower shall then pay Escrow Charges directly where payable. In such event, Lender retains the right to pay Escrow Charges that become delinquent and be reimbursed by Borrower for such payment.
    5. RESPA. Lender shall hold any and all Escrow Charges in accordance with the Real Estate Settlement Procedures Act (hereinafter "RESPA"). Lender shall make reasonable estimates of Escrow Charges and any other amounts due under Applicable Law (defined below). In accordance with RESPA, Lender shall return to Borrower any excess Escrow Charges paid by Borrower and shall notify Borrower of any deficiency in Escrow Charges that remain outstanding for Borrower to pay.
  8. SATISFACTION AND RECONVEYANCE. When all amounts secured by this Security Agreement have been paid and all obligations satisfied, Lender will execute a deed within a reasonable amount of time to reconvey the Property without warranty to whoever has become legally entitled to it, and Lender will surrender this Security Agreement and the Promissory Note to Trustee. Lender may charge a reasonable reconveyance fee if and as permitted by Applicable Law.
  9. PROPERTY INSURANCE. During all times that Lender so requires, Borrower must maintain property insurance on the structures and improvements now or hereafter existing on the Property to insure against losses that may occur by any form of hazard that Lender requires, including without limitation, fire, flood, earthquake, and hazards included within the meaning of extended coverage. All insurance policies obtained for the Property must include a standard mortgage clause and must name Lender as mortgagee and/or as an additional loss payee. Lender has the right to disprove any insurance policy obtained by Borrower and to make reasonable changes in the insurance requirements from time to time while this Security Agreement is in effect. Borrower has the right to choose the insurance carriers, subject to approval by Lender. Borrower must assign rights to proceeds received from insurance claims to the holder of the Promissory Note in an amount that satisfies the outstanding balance of the loan. Lender may require Borrower to provide it with notices from the insurance carrier and receipts for premiums paid.
    1. FAILURE TO MAINTAIN COVERAGE. Should Borrower fail to maintain adequate insurance as required and notified by Lender, Lender may obtain such types and amounts of property insurance that Lender so chooses at Borrower's expense. Any property insurance so obtained by Lender on Borrower's behalf shall become additional debts secured by this Security Agreement.
    2. INSURANCE CLAIMS. Should a loss on insured property occur, Borrower must promptly give notice to Lender and the insurance carrier. Except as otherwise agreed by Borrower and Lender in writing, all insurance proceeds received must be used to repair the Property if economically feasible without depreciating the value of Lender's security interest. Otherwise, all insurance proceeds must be applied to the outstanding balance on the Promissory Note, and any excess proceeds will go to Borrower.
    3. THIRD-PARTY FEES. All fees for third parties hired in relation to an insurance claim shall be Borrower's sole obligation and will not be paid out of insurance proceeds.
  10. OCCUPANCY. Unless Lender otherwise agrees in writing or circumstances beyond Borrower's control prevent such occupancy and use, Borrower must occupy and use the Property as its principal place of residence upon execution of this Security Agreement, or, if Borrower is a business, then Borrower must occupy and use the Property only in furtherance of its business purpose.
  11. REPAIR AND MAINTENANCE. Borrower must at all times maintain the Property, including its structures and improvements, in good repair and not damage the Property, allow deterioration of the Property, commit waste on the Property, or permit any action in violation of law to occur on or with respect to the Property. Borrower must make all necessary repairs promptly in order to avoid deterioration or a decrease in the value of the Property unless repair is not economically feasible. Borrower must make all required repairs regardless of whether insurance proceeds are sufficient to cover the expense. When necessary, Lender may make reasonable entries upon the Property for the purpose of inspecting the condition of the Property provided Lender give Borrower proper advance notice and act in accordance with all Applicable Laws when doing so. Borrower must prevent the Property from becoming vacant unless otherwise agreed in writing with Lender. Lender has the right to make necessary repairs and improvements to the Property in order to prevent deterioration and decrease in value.
  12. HAZARDOUS SUBSTANCES. Except in small quantities appropriate for residential use, Borrower must not allow the presence, disposal, or release of any hazardous substances on the Property, including without limitation, asbestos, radioactive materials, volatile solvents, toxic pesticides and other materials, pollutants, flammable materials such as gasoline or kerosene, and materials defined as toxic or hazardous by any environmental law governing the jurisdiction. If Borrower learns of the presence of any hazardous substances, Borrower must promptly notify Lender and take all actions necessary to remove the hazardous substances in a prompt manner according to the Applicable Laws.
  13. ADDITIONAL FEES. Lender may charge Borrower additional fees as a result of default on this Security Agreement or as a result of actions Lender takes to protect the value of its security interest, including without limitation, reasonable attorney's fees and costs. The fact that a fee is not expressly specified in this Security Agreement shall not bar its charge to Borrower, but all unspecified fees must conform with the Applicable Law at all times.
  14. LENDER'S RIGHT TO PROTECT ITS INTEREST. Although Lender is never obligated to do so, Lender shall have the right to take all reasonable actions to protect its interests under this Security Agreement if any of the following events occur: Borrower fails to perform any of its obligations; Borrower abandons the Property; or a legal proceeding occurs that may significantly impair Lender's interests under this Security Agreement, such as a bankruptcy, probate, or condemnation or forfeiture proceeding. This right can include paying amounts owed on liens that take priority over this Security Agreement and paying reasonable attorney's fees and costs. Upon Borrower receiving notice from Lender of such payment, any amounts paid by Lender in exercising this right shall be secured by this Security Agreement and repaid by Borrower at the Promissory Note interest rate from the date of Lender's payment.
  15. ATTORNEY-IN-FACT. Borrower hereby irrevocably appoints Lender as its attorney-in-fact for the purpose of doing all things that in Lender's opinion are necessary to protect its security interest and exercise its rights described in the preceding paragraph.
  16. EVENTS OF DEFAULT. The following are events of default under this Security Agreement:
    1. Borrower's failure to pay any amounts due under this Security Agreement or the Promissory Note;
    2. Borrower's failure to comply with any of the terms and conditions of this Security Agreement or the Promissory Note;
    3. Borrower's failure to occupy the Property according to the terms herein or the Property becomes vacant;
    4. If Lender discovers that Borrower gave materially false, misleading, or inaccurate information or statements or failed to provide material information on the loan application or otherwise to induce Lender to provide the Loan Principal;
    5. If Borrower becomes insolvent, appoints a receiver for any of Borrower's property, or commences bankruptcy proceedings voluntarily or involuntarily;
    6. If any civil or criminal legal proceeding occurs that may significantly impair Lender's interests under this Security Agreement;
    7. If a default occurs on any lien or other restriction on the Property or if the Property becomes burdened by additional liens without Lender's consent;
    8. If any governmental entity conducts a private taking on the Property through exercising its power of eminent domain;
    9. If Borrower is a business and Borrower ceases all operations, terminates, or dissolves;
    10. If the Property is a condominium and Borrower votes or allows a vote on Borrower's behalf directly or indirectly for the condominium to cease to exist as a condominium, including the sale of all or substantially all of the condominium's assets; and
    11. Borrower's breach of any other agreement executed between Borrower and Lender concerning the Property now or hereafter existing.
  17. REMEDIES. Lender has the right to use any and all remedies allowed under applicable law regardless of whether a remedy is expressly specified in this Security Agreement, including all remedies specified under the Uniform Commercial Code. Borrower agrees to reimburse Lender for all expenses Lender incurs in pursuing remedies, including reasonable attorney's fees and costs. Each remedy set forth in this Security Agreement shall be distinct and cumulative to all other remedies set forth herein or provided under the Uniform Commercial Code or other Applicable Law and may be exercised independently, concurrently, or successively with other remedies.
  18. ACCELERATION. If any default occurs under this Security Agreement, Lender must give Borrower notice of the default, whether and how the default may be cured, and any timeframe allowed for curing the default. If Lender so chooses, Lender may give Borrower further notice that all amounts secured by this Security Agreement have become immediately due and payable or that such amounts will become immediately due and payable if Borrower fails to cure the default within the timeframe provided. Any notice of acceleration shall include notice of Borrower's rights under the Applicable Laws, including Borrower's right to bring a court action challenging the existence of a default or asserting some other defense. If Lender allows a default to be cured, and Borrower cures the default within the timeframe provided, this Security Agreement will be reinstated. Upon Borrower's failure to cure the default within the timeframe provided, or if the default is not curable, Lender may require immediate payment of all amounts secured by this Security Agreement. Lender's election not to accelerate payment upon default at any one time, including allowing forbearance upon default, shall not constitute a waiver of Lender's right to accelerate payment at a later time.
  19. PROPERTY TRANSFER. If Borrower transfers title to the Property or a beneficial interest in the Property by deed, escrow agreement, or any other means without Lender's prior written consent, and if permitted under the Applicable Law, then Lender may choose to accelerate payment in full under the terms of this Security Agreement and the Promissory Note.
  20. SALE OF NOTE. Borrower agrees that the Promissory Note together with this Security Agreement, or an interest therein, may be sold one or more times without receiving prior notice. If this occurs and the new party servicing the Promissory Note changes, then Borrower will receive notice of the name and address of the new servicer as well as any other information required under RESPA. Any new servicer will still be bound by the terms of this Security Agreement, the Promissory Note, and other Applicable Law.
  21. SALE OF PROPERTY. Trustee agrees not to sell, transfer, assign, lease, or otherwise permit a change in control or ownership of the Property or any part of or interest in the Property without receiving the prior written consent of both Borrower and Lender. If Borrower and Lender do agree to such a change in control or ownership, purchaser, transferee, assignee, or lessee must execute an assumption agreement acceptable to Lender. The provisions of this paragraph do not apply to the invocation of the Lender's power of sale.
  22. POWER OF SALE. Upon Borrower's default under the terms of this Security Agreement, Lender may invoke its power of sale to foreclose on the Property and sell the Property outside of any judicial proceeding. Any delay in invoking this right or choice not to invoke this right shall not constitute a waiver to invoke this right at a later time. Upon invoking this right, Lender must send Borrower and any other parties required by Applicable Law written notice of the default and Lender's choice to sell the Property. If required by Applicable Law, Trustee shall record such notice in the county or counties in which the Property is located. Lender or Trustee will make a public notice of the sale according to Applicable Law. After the appropriate time has elapsed, Trustee will then sell the Property to the highest bidder at a public auction in accordance with Applicable Law and as specified in the public notice. Lender has the right to purchase the Property at public auction or any other sale.
  23. JUDICIAL FORECLOSURE. If permitted by Applicable Law, Lender has the right to choose to pursue judicial foreclosure in lieu of the non-judicial foreclosure that occurs when exercising its power of sale.
  24. LEASEHOLD PROPERTY. If the Property is a leasehold property, Borrower agrees as follows: Borrower will comply with all terms and obligations of the lease agreement; Borrower is not in default or breach of any term of the lease agreement; Borrower will provide Lender a copy of the lease agreement; that Borrower has good and marketable title in the leased property and has obtained any necessary consent from the landlord to put the Property in trust; Borrower will not amend or assign the lease without Lender's prior written consent; Borrower will continue to renew the lease term and perform all actions necessary to protect Lender's interest in the Property; and if Borrower acquires title to the Property, the leasehold and fee title will not merge without Lender's written consent.
  25. NOTICES. The Parties must send all notices to each other in writing and as required by Applicable Law. Each Party's address for receiving notices shall be the address stated herein unless another address is designated in writing. A notice is considered effective as of the day when sent, if that day is a business day and not a national holiday. If a notice is sent on a Saturday, Sunday, or national holiday, then it is considered effective on the first business day thereafter. A notice is not considered received by Lender unless Borrower can furnish adequate proof that the notice was sent. Unless otherwise required by Applicable Law, notice sent to any one Borrower shall be considered proper notice to all Borrowers. The Parties agree to promptly notify all other Parties of any changes of address that may occur.
  26. PAYOFF STATEMENT. Upon proper demand, Lender must furnish a written statement specifying amounts owed to satisfy all outstanding debts secured by this Security Agreement and Promissory Note in accordance with Applicable Law.
  27. ACCEPTANCE BY TRUSTEE. The Trustee named herein agrees to act as Trustee when this Security Agreement is fully executed, acknowledged, and publically recorded.
  28. SUCCESSOR TRUSTEES. If Trustee becomes unable to serve as Trustee, or if Lender so chooses to do so, Lender may appoint a successor Trustee by recording an instrument to that effect in the county or counties where the Property is located in accordance with Applicable Law. Any successor Trustee shall take on all rights and obligations specified in this Security Agreement.
  29. SUCCESSORS AND ASSIGNS. This Security Agreement shall bind and inure to the benefit of all Parties as well as their successors and assigns.
  30. GOVERNING LAW. This Security Agreement shall be construed in accordance with _____________ law. "Applicable Law" means all relevant federal, state, and local laws. All terms and conditions in this Security Agreement shall be carried out in conformance with the Applicable Law.
  31. SEVERABILITY. In the event any provision of this Security Agreement is found invalid or unenforceable for any reason whatsoever, that provision will not invalidate the remaining provisions in this Security Agreement and will be considered amended, limited, or removed as is necessary to bring it in conformance with the Applicable Law. Any interest rate specified herein found to be in excess of that permitted by the Applicable Law shall not void this Security Agreement and shall be reduced to the highest rate permitted.
  32. TIME OF ESSENCE. Time is of the essence in the performance of this Security Agreement.
  33. DESCRIPTIVE HEADINGS. The descriptive headings used herein are for convenience of reference only and they are not intended to have any effect whatsoever in determining the rights or obligations of the Parties.
  34. CONSTRUCTION. The pronouns used herein shall include, where appropriate, either gender or both, singular and plural. The terms Borrower, Lender, and Trustee shall include the singular and the plural as well as the gender-neutral pronouns (e.g. it) regardless of actual gender.
  35. COPIES. All Parties shall receive a copy of this Security Agreement and the Promissory Note.
  36. READ THIS ENTIRE AGREEMENT. Borrower acknowledges that Borrower has read this entire Agreement, agrees to comply, and has received a copy thereof, including any attached schedules, exhibits, or addendums. Borrower further acknowledges that it was under no duress in signing this agreement, and has full opportunity to negotiate the terms contained herein and to consult independent counsel.

IN WITNESS WHEREOF this deed is delivered and each Borrower, Lender, and Guarantor, if any, signs this Security Agreement in full agreement of the terms and conditions stated herein as of the date below.




Instructions for Your Deed of Trust

Completing the Form

In the first part of the form you will fill in the relevant names, addresses, and other party information involved in the transaction. This part usually takes the longest to complete, but is really just a matter of collecting and entering in the appropriate information.

In the next section you will enter one or more legal descriptions of the property. If you do not have the legal property description already, you can find it easily by contacting your county Register or Recorder of Deeds (by phone or online) and providing the property address or tax parcel number. You can also try looking at previously-recorded deeds, tax assessments, websites such as, your land title, or asking a licensed real estate attorney for help. If including multiple legal descriptions, then begin each new description on a new line.

Next, you will enter the main terms of repayment. These are located on the promissory note and will be negotiated by the parties ahead of time. Including this information is for reference purposes only. Briefly outline the main terms of repayment from the promissory note, including the principal amount owed, the interest rate, how interest is calculated (annually, semi-annually, monthly, etc.), the address where payments are to be made, and when the interest adjustment date is, if any.

Lastly, you will answer a few miscellaneous questions explained in the form and then have the option of entering any additional terms and conditions you wish to include. This is mainly to allow you to include any non-standard terms that the parties have agreed to. You may want to click the preview button to see the standard terms that have already been included.

Executing the Agreement

To execute the agreement, the parties simply sign and date it in the presence of a notary or witnesses. Most states just require one notary to act as a witness; however, two witnesses are required to sign deeds of trust in Arkansas and Georgia. These states allow a notary to sign in the place of one of the witnesses. Note, in ANY state, lenders can still choose to require two witnesses to sign. The main requirements for witnesses are that they are aged 18 years or older and are disinterested from the transaction, meaning they are not involved and have no stake in the outcome.

Final Steps

Although recording is not always required, it is highly recommended that you do record as soon as possible, because it will protect you from potential adverse claims to your title by other parties. Every deed of trust should be recorded with the appropriate local office, usually called the County Recorder's Office or County Clerk's Office. As every county has its own specific filing requirements, we recommend contacting your local office to see if it requires any supplemental forms, whether it has any special requirements you need to complete, and also if you need help writing a proper legal description.

  • Leave all margins blank. Our deed of trust sets the margin default sizes at one inch except for the top of the first page, which is three inches to give extra space for official use only. Your local office will inform you whether you need to vary these sizes somewhat.
  • Do not staple multiple pages together unless your local office specifically permits it.
  • All signatures on the document must be originals—not copied, printed, or stamped.

Once signed, witnessed, and recorded, the document is effective! It is a good idea to make sure each party gets a copy of the signed document.

Please note that the language you see here changes depending on your answers to the document questionnaire.

Mortgage Agreement

A mortgage agreement, like a deed of trust, creates a lien on real estate as collateral for a loan. Mortgage agreements are always accompanied by a promissory note, which identifies the terms of repayment in detail. In most states, the borrower holds the title to the property as long as the loan is paid off on time. If the borrower defaults, the lender can foreclose on the property, which will be dealt with through the court system.

Both a deed of trust and a mortgage agreement are used to create a lien on real estate as collateral for a loan. If the borrower fails to repay the loan on time, the lender can foreclose on the property. Mortgage agreements deal with foreclosure through the court system, while deeds of trust handle foreclosure outside of court, which is much cheaper and faster for the parties involved. Also, with a deed of trust, a trustee holds the deed to the property until the loan is repaid, instead of the lender.

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