I don't think many people knew (or cared) that when they signed a dot in a title theory state,

they were actually granting legal title to their homes to be held by the trustee for the trust for the benefit of the lender. The homeowner retained equitable title. In a title-theory state, although a dot acts as a lien, it isn't. It's a title transfer. People who sign "mortgages" are granting a lien on their homes, as are people who execute dot's in states which are "lien-theory states". In lien-theory states, the deed of trust trustee is granted equitable title to be held in trust. In non-judicial, title theory states, the trustee already holds legal title to the home in trust and the trustee is allowed by virtue of the terms in the dot to extinguish the borrower's equitable title by trustee's sale, to seize on the home without the necessity of a judicial action. Because at least in non-judicial, title theory state, the trustee holds legal title to real estate albeit in trust, all transfers of that title must be in writing pursuant to the statute of frauds. The statute of frauds says all transfers of interest in real property must be in writing. It's no different than a deed. In fact, it is a deed, just one held by the trustee for the trust created by the deed of trust. (If the Johnsons want to convey title to their home to the Smiths, they must do so by written instrument.) To make this more readily understandable, I'll just say the legislation could have just said "well, we'll just give the lender title so he can foreclose the borrower's equitable interest if there's default." But that was not the intent; it was just too much as opposed to judicial foreclosure, and provided no safety against error or abuse by the lender. So they put a third party in the act, the trustee, to hold the legal title in trust as a neutral party (regardless of claims to the contrary that the trustee is not neutral); hence the deed of TRUST. The trustee's job is to be notified of the borrower's default by the lender and to be provided evidence of that default by the lender. The trustee is then to notify the borrower of the lender's allegation of default, to issue a Notice of Default, and to hold a trustee's sale to dispose of the equitable title of the borrower. After the trustee's sale, by way of the trustee's deed, the successful bidder will have both legal and equitable title: legal and equitable are re-joined in one party. But this has been skewed terribly, starting by a misappropriation of the word "beneficiary" by MERS and its pals. The lender is to be referred in the deed of trust as the beneficiary because while the trustee holds legal title to the real estate in trust, it is the lender (and in a roundabout manner, the trustor) who is the beneficiary of that trust. You must have a beneficiary for a trust. Beneficiary means the party for whom the trust is created or has the benefit of the trust. The borrower is the trustor: he trusted the trustee to hold the legal title to his home in trust for the benefit of the beneficiary until he paid off his loan. Whether by severely eroded state law brought about by lobbying from lenders or otherwise as we slept, the trustee today is acting as the

agent of the alleged lender with no regard whatsoever for the homeowner, the trustor. Even still, the trustee may act only at the behest of the true lender/beneficiary where an amount is due and owing (and these may be two keys words - another story). A trustee cannot know if he is fulfilling his obligation to the true beneficiary unless he is given all documents which would define the party demanding he foreclose as that party. The dot trustee is meant to have a dual fiduciary to the other two parties, the beneficiary and the trustor. Even if his fiduciary is limited to the beneficiary (a proposition with which I disagree - remember, it was for the convenience of the beneficiary who wanted to avoid the time and expense of judicial foreclosure that the deed of trust was implemented), he still owes a duty of good faith and fair dealing to the borrower. These are covenants which arise in contract, and the contract is the deed of trust, which is the collateral instrument for the debt evidenced by the note. A collateral instrument without the right to payment on the debt it secures is indeed a worthless piece of paper. What is going on today is an abomination. The (alleged) lenders/ beneficiaries have done away with the homeowner' protections of judicial foreclosure and rather than honoring the terms and spirit of the deed of trust, are hiring parties in the guise of trustees who are in reality no more than their collection agents. The lenders were given major concessions by the implementation of the deed of trust and have taken the proverbial and very ugly mile. By all appearances, it is their own misdeeds and shortcomings which cause some people to perpetuate even more misdeeds.