The role of the bare trustee is to act as the lender of record. This means the mortgage deed is made between the borrower and the bare trustee (not the investors). It is the bare trustee’s name that appears on the Torrens Title.
A bare trustee is used to:
- shield the investors from direct approach by the borrower;
- for the privacy of the investors (to keep their names or their companies’ names off the Torrens register);
- insulate the investors from nuisance proceedings should the borrower make a claim after the mortgage discharges;
- simplify administration where a mortgage syndicate is involved.