When a deed of trust is paid off, what must the trustee do?

• A. Re-convey the deed to the borrower
• B. Sell the property to the highest bidder
• C. Foreclose the mortgage
• D. Extend the loan terms automatically

Answer: (A)

When a deed of trust is paid off, the security interest it creates is released. The trustee’s duty is to reconvey the property's title back to the borrower, usually by issuing a reconveyance deed (and getting it recorded) so the lien is formally removed and the borrower holds clear title. This is the natural end of the loan arrangement, since there’s no longer a debt backing the deed of trust.

Foreclosure or selling the property would happen only if the borrower defaults, not when the loan is fully paid. Extending the loan terms automatically isn’t required or automatic; extensions require new terms or an agreement.