Select the statement that accurately reflects the type of deed used for the transfer.

The statement about a deed of trust accurately reflects the purpose and function of that type of deed. A deed of trust is a legal document that secures a loan by conveying real estate to a trustee, who holds the title for the benefit of a lender (the beneficiary) until the debt is repaid. This arrangement provides the lender with security in the event the borrower defaults on the loan.

Understanding the role of a trustee is crucial; they hold the legal title to the property, while the borrower retains equitable title. If the borrower fails to meet the obligations of the loan, the trustee has the authority to sell the property to satisfy the debt.

Other types of deeds mentioned in the options serve different purposes. A warranty deed provides assurances regarding the title's validity, while a quitclaim deed transfers interest without warranties and does not guarantee the quitable title of the property. A grant deed typically implies a transfer of ownership but can carry with it certain warranties, which is distinct from the specific functioning of a deed of trust.

In the context of real estate transactions, recognizing the specific kind of deed used—such as a deed of trust—helps clarify the rights and responsibilities of the parties involved, as well as the protections available to lenders.