Who owns a mortgaged house? the "owner" or the bank?

phill99

Itismehonest wrote: »

It's the bank's property until you've paid them for it in full but you have the right to treat it as your own within limits the bank & the law set.

This forum is brilliant. people can offer their opinions on which they no absolutely nothing about and confuse people in the process.

The above statement is an example of that.

When you buy a freehold (the 'fee simple absolute in possession' in legal terms) the ownership 'title'rests with the person that bought it. the bank has not bought it. They have simply lent you the money to buy it, but because there is an outside chance that you won't pay it back, you have to grant them a 'mortgage' over the property which secures the loan against the bricks and mortar ('colatoral'). That's the only interest they have in the property.

If they owned it as many people incorrectly suggest, then they would be responsible when the roof blows off, when the kitchen needs refitting and when you have got last nights curry backing up through your toilet. But they are not. You are.

I really wish people would not comment on posts unless they actually know the answer rather than just offering ill informed and maligned guesses.

G_M

Itismehonest wrote: »

I'm pointing out the difference between having a mortgage & owning a mortgage-free (total ownership) property.

No. You started out by saying

From what I've been lead to believe, when you buy a house with a mortgage, it's pretty much just like renting

You were comparing ownership (albeit with a mortgage) with renting.

Now you seem to want to compare debt-free ownership with ownership where you've borrowed money.

Make up your mind!

abankerbutnotafatcat

As others have said, you own the house but the lender has a charge against it that they can enforce if you default on your contract with them.

We refer to them as 'mortgages' but in fact the mortgage is the charge against property. They are more accurately 'loans secured by a first, fixed charge over a residential property'. I won't bore you more...

RikM

I don't really understand the difficulty here. It's not like HP, where the finance company owns a vehicle, until it's paid off.

With a mortgage, the bank has an interest in your house as security on the loan used to buy it. That's it. It's not that complicated...

phill99

RikM wrote: »

I don't really understand the difficulty here. It's not like HP, where the finance company owns a vehicle, until it's paid off.

With a mortgage, the bank has an interest in your house as security on the loan used to buy it. That's it. It's not that complicated...

You are absolutely right Rik. It isn't complicated. It's only complicated when some numpties (not you!) comment on stuff they know nothing about.

MonkeySaving?

phill99 wrote: »

If they owned it as many people incorrectly suggest, then they would be responsible when the roof blows off, when the kitchen needs refitting and when you have got last nights curry backing up through your toilet. But they are not. You are.

And if the roof blows off and due to the cost of replacing the roof you fail to make your mortgage payments? Who owns it then?

Owning a house is EXACTLY like owning a car on finance, don't like it, hand it back and pay penalties, don't pay your monthly fee and they'll take it off you anyway.

phill99

MonkeySaving? wrote: »

And if the roof blows off and due to the cost of replacing the roof you fail to make your mortgage payments? Who owns it then?

Owning a house is EXACTLY like owning a car on finance, don't like it, hand it back and pay penalties, don't pay your monthly fee and they'll take it off you anyway.

I don't know what your problem is, but I bet its difficult to pronounce.

abankerbutnotafatcat

I think the confusion may be that cars can be financed one of two main ways either a loan secured against the car (so owned by you the same as a house loan) or by a lease where you are effectively renting the car for a set period sometimes with an option to buy at the end. The latter arrangement may be preferred for tax efficiency reasons.

sonastin

renting: the property belongs to the LL. you pay an amount each month. (within the restrictions of LL&T Law), the LL can do anything he likes with the property. If you don't like it, you can either leave or buy the house off the LL - he can charge ANY price he wants to sell it to you.

owning with mortgage: the property belongs to you. you pay an amount each month. (within the restrictions of the mortgage conditions) you can do anything you like with the property. If you don't like the mortgage restrictions, you just have to pay back the loan - the amount you pay to make the problem go away is already fixed.

So considerable differences in who has the control over the property and what you are entitled to do if you want to change the balance of control.

Itismehonest

phill99 wrote: »

You are absolutely right Rik. It isn't complicated. It's only complicated when some numpties (not you!) comment on stuff they know nothing about.

Numpty I may be but obviously while I may lack complete understanding of the subject I have at least retained some manners.
I can see the point made about responsibility for repairing damage & am happy to apologise for being wrong. Maybe you'd consider apologising for unwarranted personal name-calling?
I own my own property & cars so you'll have to forgive me for mistakenly believing that in some way that gives a little more entitlement to the phrase "ownership" than if I were having to pay someone else to enjoy their use.

@ abankerbutnotafatcat. Thank you. That does make things clearer.