The Definition of a Leasehold Deed of Trust

By Jennifer VanBaren

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A leasehold deed of trust is formed when a leaseholder acquires a long-term lease with another party and wants to build a structure of some kind on the property.

Leasehold

A written rental agreement for an extended period of time is referred to as a leasehold, which describes improvements made on property by the company leasing the land. It also describes options that may occur when the lease ends.

Deed of Trust

A deed of trust is a document pledging real property as collateral when securing a loan. The owner of the property deeds it to a beneficiary, which is typically the moneylender. When the loan is repaid in full, the title of the property returns to the owner.

Combination

A leasehold deed of trust combines a leasehold and a deed of trust. This document is used by companies that lease a property for a long-term period; the time period can vary, but it is typically for 20 years or more. The company leasing the land builds a structure on the property, but the owner of the land may obtain the loan for the building. If this happens, a leasehold deed of trust is created, which requires the company leasing the land to do so for the long term.

About the Author

Jennifer VanBaren started her professional online writing career in 2010. She taught college-level accounting, math and business classes for five years. Her writing highlights include publishing articles about music, business, gardening and home organization. She holds a Bachelor of Science in accounting and finance from St. Joseph's College in Rensselaer, Ind.

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