To think having a house with a mortgage is not 'owning your own home'

[easternuts]

We had a mortgage for 30 years before paying it off recently on our modest home. Now we consider ourselves home owners.

Dd rents because she doesn't want to pay the bank more in interest than the cost of her rent is. Yes her rent can go up but so can your mortgage.

I've had friends of mine make snide comments that dd is going on another holiday when she doesn't own her own home. This is as opposed to their own children who have recently bought with 95% or 90% mortgages in a part of the country where a 3 bed house is less than £150k.

AIBU to think that you don't own your own home just because you have a £15k down payment. DD has far beyond what is needed for a deposit but it makes zero sense in central London at present.

The flat I've just left was worth at least £500k. Rent locally looks to be around £1500-2000 at the moment for a similar flat. A 5% mortgage on £450k would be around £2600.

I've lived in various flats that I couldn't have afforded the mortgage on, even though I had a 10% deposit. The rental market and the mortgage market are not always connected. My landlord had a small mortgage. Even if it had been larger he might have locked in the mortgage at a lower rate a few years back, meaning it was still worth renting to me if you ignore the opportunity cost. But exiting the market is a big hurdle so many stay.

But it's only relevant if you default on payment of the loan 🤦‍♀️
Any charge holder can force a sale if you stop paying. They don't actually own your house either.
It's hard to believe you've bought and sold multiple properties without grasping this.

I have been buying and selling properties since the late ‘80’s

Without understanding the absolutely basic legal position of how ownership and mortgages work?

If the bank owns it, why can't it just sell it even if you're up to date with payments? Why can't it put in a new kitchen? Why can't it evict you and put its CEO in there?

Most people use the term "owning your own home" to mean with or without a mortgage. And legally I'm pretty sure you do own it even if you have a mortgage.

You only lose the debt you haven't paid.
If my mortgage was 50K on a 300K house, then I lose that, which does mean I lose the house - but I get 250K back in return.

How can it ever be "worth" renting when you're left with literally nothing at the end of it? You've contributed to paying off an asset for your landlord.

I find it astounding that someone who has bought and sold really doesnt understand the legalities involved

Havent you had this explained properly to you?

The bank can only repossess by going to court and transferring ownership to themselves in the light of non payment. Just like if you dont pay any debt, you'll get taken to court and some of your belongings will get taken by baliffs.

The difference is its a secured loan, so the thing that gets taken back is the security, the house.

its quite worrying the amount of people who dont get this. No wonder that other poster is losing patience with you

Yes. You do. The bank has a charge on it; that's something else entirely.

Are there really this many people, including property investors and high value sellers, who don't undestand this?

I agree. People talk about how common renting is in Europe and how home ownership isn’t the priority there like it is here, but that ignores the very different contexts. I’ve rented privately, had a HA property, and now own and renting privately was far and away the worst.

Repossession is pretty difficult these days. It’s always possible but it’s a last resort. The bank do not own your house just because they have a charge

I'm mind blown. Truly I am!

I thought I was out the loop on mortgages etc, but Jesus. I at least knew I owned the house I was taking the mortgage out on

Even in this low cost area, a standard mortgage on a 2/3 bed terraced house is much cheaper than renting it. IMO it’s a very easy decision….if you intend to remain in an area for any length of time, buying is much cheaper than renting

The key word here is REpossessed. Ie taken from its original owner!

Find better friends that don't care whether she rents, buys, squats or sets up a bloody bell tent in your garden because her living arrangements are none of their business.

I think there seems to be a big divide in this country between private renting and mortgages. I have done both. While renting I felt it was looked down upon by certain friends. However the rent never went up and was a permanent rent due to being owned by farmers and they were unable to sell as a clause. If she is young and living her life good for her. As long as she has the money to buy when she is ready. I guess she doesn’t have to buy in central London where her work is she could commute in from the outskirts of surrounding counties. But she needs to do what works for her. It is no one else’s business. The good thing about renting is the freedom I think. However owning your own home generally provides security in the long term particularly if she has a family.

Agree with others that the main reason I want to own is so that I can’t be kicked out at short notice.

I can buy furniture knowing it’s going to fit my space for as long as I’m there.

I can decorate how I like. Nothing more joyless than a rented white box where you can’t even hang a fucking photo on the wall.

I can make the garden nice knowing I’ll enjoy it for decades to come.

We own our house with a mortgage. We don’t own outright. Thats the difference. Both scenarios the house is owned.

We can do what we want in the house, we don’t have to ask permission, we don’t have to leave it as we found it. It is ours.

Show me the flat that rents for less than the mortgage interest on the same property....

The maths on it doesn't work - the landlord would be out of pocket to pay the mortgage each month, which is why its generally always more expensive to rent unless you can't get a mortgage (due to poor credit, lack of deposit, worklessness or benefit dependency, age etc).

This.

You're wrong OP. You are the legal owner even if you have a mortgage or not.

I was just showing how the mortgage isn't always cheaper. At least not in direct monthly terms. There were various reasons buying wasn't the right thing for me at the time.

I did save a big deposit and bought and my mortgage is now what my old rent (I suspect it's gone up!) was. But I've sunk a heap of cash into the deposit for it to be that low.

It's quite worrying lol

I mean even paying just the interest only on a mortgage is better than renting. It’s an asset that generally doubles on average every 10 years.

If I borrowed money from you to buy myself a loaf of bread, who owns the bread once i've bought it, you or me ? Also by your logic OP, those who buy clothes using a credit card don't own the clothes either, apparently whoever their credit card provider is would own all the clothes 🤷🏻‍♀️

Please do a little research. You don’t seem to understand the basics of personal finance!

Honestly this website has killed me today, what with people not owning apples, people dropping trays of doughnuts on another thread.