What is the term for an agreement in which a borrower pledges property to secure a loan?

The term for an agreement in which a borrower pledges property to secure a loan is known as a "deed of trust." This legal instrument is used in real estate transactions, particularly in many states, to facilitate the borrowing process. In a deed of trust, the borrower conveys the title of the property to a third party, known as the trustee, who holds it as security for the loan until the borrower repays the debt. If the borrower defaults on the loan, the trustee has the authority to sell the property and recover the owed amount, effectively protecting the lender’s interest.

This mechanism is essential in real estate financing as it provides the lender a means to secure their investment and lays out the responsibilities and rights of all parties involved. Other terms like earnest money deposit, down payment, and easement do not relate directly to the concept of securing a loan with property. An earnest money deposit is an advance payment to demonstrate a buyer's commitment to a purchase, a down payment is an initial upfront payment made when purchasing, and an easement is a legal right to use someone else’s land for a specific purpose, which does not involve securing a loan.