<P> Deeds of trust differ from mortgages in that deeds of trust always involve at least three parties, where the third party holds the legal title, while in the context of mortgages, the mortgagor gives legal title directly to the mortgagee . In either case, equitable title remains with the borrower . Both mortgages and deeds of trust are essentially security instruments in the form of conveyances; that is, they appear to provide on their face for absolute conveyances of legal title, but it is implicitly understood that the borrower is retaining equitable title and the conveyance is intended to merely create a security interest . This confusing situation is a legacy of the archaic (and now - obsolete) common law requirement of livery of seisin, under which English common law courts had refused to enforce shifting fees or springing freehold interests (that is, a gage for years that was supposed to automatically expand to fee simple title if the underlying debt was not repaid). </P> <P> A deed of trust is normally recorded with the recorder or county clerk for the county where the property is located as evidence of and security for the debt . The act of recording provides constructive notice to the world that the property has been encumbered . When the debt is fully paid, the beneficiary is required by law to promptly direct the trustee to transfer the property back to the trustor by reconveyance, thus releasing the security for the debt . </P> <P> Deeds of trust are the most common instrument used in the financing of real estate purchases in Alaska, Arizona, California, Colorado, the District of Columbia, Idaho, Maryland, Mississippi, Missouri, Montana, Nebraska, Nevada, North Carolina, Oregon, Tennessee, Texas, Utah, Virginia, Washington, and West Virginia, whereas most other states use mortgages . Besides purchases, deeds of trust can also be used for loans made for other kinds of purposes where real estate is merely offered as collateral, and are also used to secure performance of contracts other than loans . </P> <P> A deed of trust has a crucial advantage over a mortgage from the lender's point of view . If the borrower defaults on the loan, the trustee has the power to foreclose on the property on behalf of the beneficiary . In most U.S. states, a deed of trust (but not a mortgage) can contain a special "power of sale" clause that permits the trustee to exercise these powers . Here is the standard conveyance clause from a Freddie Mac "uniform instrument": </P>

Is california a deed of trust or mortgage state