Document background
The Note and Deed of Trust is a fundamental document in Swiss real estate financing, used when a borrower seeks to secure a loan with real property. This document type combines the debt instrument (Note) with a security mechanism (Deed of Trust) that places the property in trust as collateral. It's particularly important in Switzerland due to the unique interaction between Swiss property law, which traditionally doesn't recognize common law trusts, and the implemented provisions of the Hague Trust Convention. The document must comply with strict Swiss formal requirements for real estate security instruments while accommodating the three-party trust structure. It's commonly used in both commercial and residential property transactions, providing lenders with a secure interest in the property while allowing borrowers to maintain possession and use of the property during the loan term.
