In the vein of houses and cars, yeah. I should get in a better habit of elaborating on ambiguous terms in the body, only haven’t as I’ve mixed experience with people skipping over those.
When you take out a loan/mortgage, the bank does not own the property you purchase with those funds. You own the property, and you use it essentially as collateral to secure the loan. (It’s considered a lien.) The bank can take ownership of the property if you violate the terms of the agreement, typically by failing to pay what you owe, but the bank doesn’t own the property.
It does, sure. It helps to understand that the debt is separate from the property, same as if you borrowed $20 for lunch—it feels a lot different from your friend buying you lunch, but it doesn’t feel like your friend owns your lunch until you repay them, either.
With real estate especially, once the property begins to require your attention and money, you begin to feel that ownership more acutely. The bank has no idea when the gutters need to be cleared or there’s a drainage issue. They’re concerned only with the loan.
I’m still confused. I own my houses and cars. I’m still paying for one of my houses (the one my mum lives in) but it’s legally mine as long as I continue to pay the mortgage.
Own as in mortgages/loans paid off, I take it? That’s the slight distinction I’m thinking of with expensive items that typically can’t be bought outright. It’s not wholly owned until mortgage/loan is paid off, which you kinda nod towards with your last sentence.
But you legally own your house if your name is on the title deeds. The deeds say I am the owner regardless of whether there is a mortgage or not. The mortgage is recorded on the title deeds, but it doesn’t change the fact that I am the owner. I can do whatever I want with it.
In essence, I have a loan against it but in extremis, the bank can force me to sell. I would get anything over the loan amount I sold it for but the bank would have no reason to do this if I continue to pay.
In the vein of houses and cars, yeah. I should get in a better habit of elaborating on ambiguous terms in the body, only haven’t as I’ve mixed experience with people skipping over those.
When you take out a loan/mortgage, the bank does not own the property you purchase with those funds. You own the property, and you use it essentially as collateral to secure the loan. (It’s considered a lien.) The bank can take ownership of the property if you violate the terms of the agreement, typically by failing to pay what you owe, but the bank doesn’t own the property.
Mentioning @Diddlydee@feddit.uk here to address you both in your similar corrections rather than duplicate my reply: I stand corrected.
I see that I had misconstrued my personal misgivings with the penalties of failing to pay with a lack of legal ownership.
It still feels off, precarious, to describe it as ownership to me, but I recognize what you’re both saying regarding the legal standing of it all.
It does, sure. It helps to understand that the debt is separate from the property, same as if you borrowed $20 for lunch—it feels a lot different from your friend buying you lunch, but it doesn’t feel like your friend owns your lunch until you repay them, either.
With real estate especially, once the property begins to require your attention and money, you begin to feel that ownership more acutely. The bank has no idea when the gutters need to be cleared or there’s a drainage issue. They’re concerned only with the loan.
I’m still confused. I own my houses and cars. I’m still paying for one of my houses (the one my mum lives in) but it’s legally mine as long as I continue to pay the mortgage.
Own as in mortgages/loans paid off, I take it? That’s the slight distinction I’m thinking of with expensive items that typically can’t be bought outright. It’s not wholly owned until mortgage/loan is paid off, which you kinda nod towards with your last sentence.
But you legally own your house if your name is on the title deeds. The deeds say I am the owner regardless of whether there is a mortgage or not. The mortgage is recorded on the title deeds, but it doesn’t change the fact that I am the owner. I can do whatever I want with it.
In essence, I have a loan against it but in extremis, the bank can force me to sell. I would get anything over the loan amount I sold it for but the bank would have no reason to do this if I continue to pay.