Who owns the house in a mortgage?

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When a person buys a house, they may receive congratulations from family and friends as the “new owner”. Some new buyers may retort with the old joke, “Well, the bank owns it, but I live here and pay for it!”

See: Mortgages 101: Should I go to several lenders?
Find: Stimulus Update: Mortgage Assistance Now Available in Arizona

Of course, you are not a tenant with a landlord, so you have certain rights within your home…and that includes the right to be proud of your purchase! You also have the right to make changes to the interior of the home and property, in accordance with local building codes.

But you might be surprised to learn that even though the property was purchased through a mortgage agreement, you still own the house. Your name is on the title as the owner. The bank or mortgage company has an interest in the property and the mortgage note itself, but the lender does not own your home.

Your home is considered collateral for the mortgage loan. As long as you repay your home loan according to the terms, you are the legal owner of the property. Even if your mortgage is in arrears, the foreclosure process can take time and you’ll have plenty of opportunities to negotiate a deal or keep up to date with your payments. Until the mortgage lender successfully forecloses, you still own the home.

Learn: How many houses does $200,000 buy you in each state?
Explore: Tips for Building Generational Wealth Through Real Estate

So the next time someone congratulates you on the purchase of your new home, just smile, say “thank you,” and maybe invite them to your housewarming party — after all, it’s your house!

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About the Author

Dawn Allcot is a full-time freelance writer and content marketer with interests in finance, e-commerce, technology, and real estate. His long list of publishing credits includes Bankrate, Lending Tree and Chase Bank. She is the founder and owner of GeekTravelGuide.net, a travel, technology and entertainment website. She lives in Long Island, New York, with a veritable menagerie that includes 2 cats, a rambunctious kitten and three lizards of different sizes and personalities – plus her two children and her husband. Find her on Twitter, @DawnAllcot.

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