Q. I would appreciate if you could tell me the difference between a deed of trust and a mortgage. E.T.D., Maryland

A. For all practical purposes, there is little or no difference. And what little specific, technical differences there are vary from jurisdiction to jurisdiction - even from lender to lender sometimes. Both a deed of trust and a mortgage provide a lender with the security of real property for the amount lent to the borrower (as evidenced by a note).

Technically, specifically, a deed of trust vests title to the real property in a trustee of trustees named by the lender. The borrower has the right to possess and use the real property as long as he complies with the terms of the deed of trust and the note. In the event of the borrower's default, the deed of trust usually provides that the property may be sold by the trustee or trustees, and the mortgage debt paid.

There are two types of mortgages: (1) One type secures the mortgage loan by creating alien on the real property. Title is in the borrower. (2) The other type secures the mortgage loan the same way the deed of trust does, ie., by conveying title to the lender. The borrower has the right to possess and use the real property as long as he complies with the terms of the mortgage and note.

In the event of default, in (1) above, an action of foreclosure is usually necessary. In (2) above, since the lender has title, an action of foreclosure isn't usually necessary. The lender sells the property and pays the mortgage debt.

The law governing exact rights and obligations of the lender and borrower is usually spelled out by statute and supplemented by judicial decisions.