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.

It's not because they don't own their home, it's because they can't keep up repayments to their lender!

If you buy a fridge on your NatWest credit card, and then can't pay your card bill, does NatWest own the fridge?

I think the biggest advantage comes with retirement, when your salary suddenly drops/disappears will you still be able to afford to pay rent/ still find the money if your landlord decides to turf you out and you need to come up with a deposit on the spot! Who cares if you're paying it off for thirty/thirty five/ forty years but also if you can't get a mortgage/don't want to get one that's a choice too. Odd for them to smirk over it, they're probably trying to get you to admit you've a deposit ready for her/she's rich or something

The lender can only commence possession proceedings when at least two months of mortgage payment are outstanding, LPA 1925. In reality, they must use it as a last resort, and the government did ask that lenders not apply for possession until at least 6 months are owed.

No they don’t. Hsbc or natwest aren’t listed on the deeds of the property.

yes the bank can reclaim through forbearance the property as it is a secured loan, but they don’t want to, they lose a substantial amount of money doing this. The bank does not own the house, you do. You just have a loan secured against the property to finance it

Or if you haven’t bought yet…

Once your name is on the title deeds you own your own home - you just owe the bank a lot of money along side it and are obliged to sell the house to repay that loan if you fall behind on payments, because it’s secured against the asset/house.

No different to buying a pair of trainers with your overdraft or your credit card - you own them, but your debt has increased.

So yes, YABU to think you don’t own your house.

YANBU however to be narked by the snide remarks by others about your daughter. She is young and her financial decisions are her own. Am sure that when (if) the economy and housing market settles, she’ll regroup, but it’s no-one’s business but her own.

this is exactly it and from an insider point of view most lenders do not formally count missing one or two payments as being in arrears, it’s normally 3 onwards and they will actively work with you and proactively reach out to stop it getting to the point of repossessing the house (the bank lose a lot of money in repossession so it must be a last resort). It’s normally those with huge arrears balances (tens of thousands) and who are not engaging that foreclosing happens

first there will be repayment holidays, moving to IO, concessionaire rates, consent to let, assisted sale etc

Actually mortgage lenders are on the 'deeds'. The land registry entry for that property lists the persons/institution who has a legal charge on the property, but as you say they are not listed as owners.

I clearly meant as owner, plus a lender can change as people switch deals

Even if house prices do not rise, paying off a mortgage means you have an asset at the end of the day. Paying rent just means you pay someone else's mortgage, and they have the asset.

The difference is simple, if you have a mortgage one day assuming you don't default you will own your house outright. If you rent you will never own your home

Not “keeping up repayments to my lender” would still result in me losing my home because I don’t own it outright though so I don’t really care about the circumstances of language tbh. I will have the massive celebration we when pay our final repayment. Until then, I feel at the mercy of interest rates etc.

@easternuts

Please read this article, it may explain why mortgage debt can't be considered normal debt in the same vein as credit cards, etc

https://www.nasdaq.com/articles/why-did-mark-zuckerberg-get-a-mortgage-on-his-home

You still owned your home while you were paying off the loan you used to buy your house.

I haven’t read all the replies, but you own the house not the bank. If you got a loan to buy a car who owns the car? You.

I feel like you’re trying to justify why your dd rents and in doing so are attempting to pull down homeowners. Most people agree renting is dead money, even more so if you’re in a position to buy. Your dd is ultimately paying someone else’s mortgage, funding their investment, not her own.

It’s not that straightforward, if you didn’t make your repayments for probably years and refused to engage with the bank, that would most likely cost you your home.

absolutely have your party when it’s all done.

but don’t stress about rates, inflation is coming down, swaps went up a bit last week bit but the overall sentiment is that things will be coming down, not the pandemic rates down but down overall to now

In a nutshell, the very wealthy still get loans to buy property , because its a low rate debt and the money not put forward to buy property cash can be used for investing elswhere.

Rich people get money to work for them
Poor people work to get money.

I don’t really care about the circumstances of language tbh

Well you should because that's how we express and confirm the literal legal status of who owns the house and why the bank can't just come in and rip out your bathroom and evict you because it feels like it.

You wouldn't lose your home because you don't own outright, you'd lose your home because you wouldn't have kept up repayments and the house is the security on the loan. You really should care about understanding what you've signed!

That only works if you were investing the money you're paying on rent. But it just goes to the landlord. It's not an investment.

Ive got to go everyone, sorry to leave the thread, Barclays have just turned up unannounced to use the oven!!!

Bloody cheek of them. They're waving papers around at me shouting something about being legal owners.

Bastards.

I don’t really care about the circumstances of language tbh

You should care. You’ll be screwed in life if you are signing legal papers without understanding what they actually mean.

The Land Registry entry is updated when you change your lender in order to safeguard their investment.

I mean, all the other things I own in life, including my car, clothes, computer etc. are mine to do as I please and I don't have to pay anything else ever again for them to remain mine. I have to pay stuff to use the car as intended, of course, but if I wanted to keep it in a garage forever nobody would take it away. That's what I mean by "owning". "I own something, but I have to pay a lot of money monthly to keep owning it," is essentially a subscription service. It's a better deal than rental, of course. I think it would be daft to claim otherwise. You own the house for real at the end if you live long enough. But it still isn't real ownership.

is That true though? Nearly all landlords have interest only mortgages?

about 60% of landlords have mortgages. The rest own outright. So just over half have a mortgage. Assuming the majority of those who have a mortgage is interest only- this is probably at most half?

have I got my sources wrong?

My name is on the deeds so I own it. Rather pay my own mortgage than someone else's. Not that it really matters what anyone else thinks or does