9 ms·

I hate when people use the term own to mean have a mortgage. you don't own it. the bank owns it and you're a caretaker of it for 30 years

verall 4y ago
Very silly take. If the property value changes, the loan doesn't. You're responsible for maintenance. I don't see how it's relevant that you have a loan against it. If you own your home outright, and then take out a HELOC, do you no longer own your home?
- deleted 4y ago
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  - deleted 4y ago
    [deleted]
- sixstringtheory 4y ago
  > If the property value changes, the loan doesn't That works both ways. Google "underwater mortgage"
  - verall 4y ago
    Obviously, which is why you are the homeowner and the bank isn't.
    - sixstringtheory 4y ago
      Depends on your definition of "own" I suppose. If you have a mortgage, the bank has a mortgage lien on the home, which gives them a legal right to take it from you if you don't pay. I.e. you will get kicked to the curb on an underwater mortgage if you can't make the payments any longer, but also can't afford to bridge the gap in order to sell.
      - dragonwriter 4y ago
        > If you have a mortgage, the bank has a mortgage lien on the home, which gives them a legal right to take it from you if you don't pay. I.e. you will get kicked to the curb on an underwater mortgage if you can't make the payments any longer, but also can't afford to bridge the gap in order to sell. In a non-recourse state (or, to a lesser extent, even in a recourse state) foreclosure on an underwater mortgage loans isn't a great deal for the bank; it either eliminates any chance on recovering part of the mortgage (non-recourse), or turns the amount above what can be realized in a foreclosure sale into a non-secured debt (recourse). Depending on circumstances, there's a chance they'll just choose not to do that for a very long time (much longer than would be the case either with an "above water" mortgage that wasn't being paid, or than a landlord would float a tenant that wasn't paying.) They also have a pretty big incentive to approve a short sale on an underwater mortgage, since you'll probably get a better price than a foreclosure sale and cost them less money than foreclosing and trying to sell. (Have I been underwater, gone an extended period of time withput paying a mortgage both while living in the home and then after moving out, getting a buyer, and proposing and waiting for approval for a short sale, in a non-recourse state? Yes, yes I have.)
        sixstringtheory 4y ago
        Dang, that sounds stressful. Hope you came out the other end of that ok! And thanks for the extra context and sharing your experience.
- nerdchum 4y ago
  value doesn't mean anything in this case. what matters is that someone can take away your property if you don't do what they say. That's not ownership.
  - medvezhenok 4y ago
    Same thing happens in a paid off house if you don't pay your property tax.
    - nerdchum 4y ago
      Exactly. You're a SERF to the government forever! People lose their house often to runaway property taxes. This should anger people more.
      - verall 4y ago
        This is unhinged. If purchasing a piece of land means that it stays within your family forever with no additional payments or taxes, that's feudalism.
        nerdchum 4y ago
        I don't think you understand. feudalism. you should google it. feudalism is NOT owning your land because the government owns it and you pay them for the use of the land which is exactly what we have now.
        verall 4y ago
        If the government exists to protect property rights through use of force, and property owners have access to that system without paying taxes, what do you call the rest of us, who have to pay rents to those property owners and taxes for the government? Not serfs? Even feudal lords had to protect their own land and were also expected to protect their serfs, lest their serfs' foods be given to raiders rather than their lord.
beisner 4y ago
No, they own both an asset and a liability, secured by that asset.
- Shaggy2000 4y ago
  That's an even worse position to be honest
  - bluGill 4y ago
    Depends on if you are able to pay it off or not.
deleted 4y ago
[deleted]
strontian 4y ago
You do own it, you’re just also short a bunch of dollars spread into the future.
- bluGill 4y ago
  Not that much as you need to pay rent otherwise. With inflation in a dozen years you have more money than renters. Of course how valuable this is depends on how long you live and a number of other factors.
User23 4y ago
By that view you never own land since you’re always on the hook for property tax, which is a kind of rent. I suppose there are rare cases of allodial title. Nevada used to let you buy an allodial title that couldn't be inherited. It was useful for doing things like getting a second mortgage from a bank that wasn't aware of the law and then immediately defaulting and telling them to get bent because they can't legally foreclose on an allod. Needless to say lobbyists successfully put a stop to that.
- xdennis 4y ago
  Paying taxes doesn't mean you don't own it. If you don't pay your taxes you go to prison, they don't take your house away.
  - User23 4y ago
    Tax lien foreclosures and tax deed sales are absolutely a thing. You certainly can lose your house for not paying property taxes.
  - yucky 4y ago
    This isn't true. If you don't pay your property taxes you do not go to prison, you just lose the property.
- lo_zamoyski 4y ago
  > By that view you never own land since you’re always on the hook for property tax, which is a kind of rent. Bad comparison. That both failing to pay off a loan or pay property taxes can lead to foreclosure is a superficial similarity. Property tax isn't paying off a debt you owe a bank for a loan used to buy the house. It's merely a tax collected to cover municipal expenses that's calculated based on the value of your house. Now as to whether the bank owns the house you bought using a loan, morally there is a certain practical truthfulness to that statement, perhaps, and for practical purposes is may be somewhat pedantic making distinction that determine "true" ownership. But strictly speaking, as with borrowing in general, if a loan is money you've borrowed that you then use to buy an asset like a house, then what you owe the lender isn't the house, but the value of the loan. If I lend you $20, and you buy a book with that money, you don't owe me the book, you owe me $20.
fasthands9 4y ago
I feel like its a useful metric for lots of issues - especially public policy issues. Even if the bank "owns" the home you get the tax breaks for it and behave like someone who has a self-interest of increasing the value of it.
- nerdchum 4y ago
  none of that matters though to the true definition of ownership which is complete control over the object people.seem.to want to identify as an owner as it makes them feel good.
  - fasthands9 4y ago
    youre getting stuck in semantics. if you own a house in the US you still pay property tax and are subject to the rules and regulations around it anyway. the point of these stats is to know who is a renter and who has property they own.
    - nerdchum 4y ago
      I completely agree. After you pay off the bank you STILL don't own the property thanks to the government who can take it away. a homeowner is merely a serf for the government property taxes.
smt88 4y ago
You seem to be using a definition of "own" that differs from the one everyone else is using. The bank can't gain or lose money when your home changes in value. It can't enter your home without your permission, change the paint color, or sell your home. It can do these things if you become unable to pay for your mortgage. Your home is security for them, but you could buy a house with a loan secured by anything else. It's not uncommon for wealthy people to borrow against their stocks and then buy a home "in cash". In that situation, you'd never say "the bank owns their home" just because they owe the bank a bunch of money.
- onlyrealcuzzo 4y ago
  Importantly, it doesn't raise your rent 3-10% every year. Your property tax & insurance (usually less than 1/4th of your payment) goes up 2-3% (in most places).
  - S201 4y ago
    > Your property tax & insurance [...] goes up 2-3% (in most places). Heh, or in my case: 30% this year.
    - hdespiritu 4y ago
      If it's your primary residence, the homestead tax credit can offset that increase substantially https://smartasset.com/taxes/what-is-a-homestead-tax-exemption https://smartasset.com/taxes/what-is-a-homestead-tax-exempti... OP's original point still stands. Real estate in America is designed to have many economic advantages for wealth accumulation and preservation. You might even go as far as saying the economic advantages of real estate are a byproduct of regulatory capture
      - nerdchum 4y ago
        > economic advantages of real estate are a byproduct of regulatory capture This seems correct to me. I don't think it's been specifically designed to be a store of wealth.
nosequel 4y ago
Spot the renter in SF/Seattle/LA/NYC mad about wording around people "owning" a house. Yes I have a mortgage, but at least my monthly payments are 98.01% going to my own future. Renting doesn't even compare, just throwing money at someone else's retirement.
- pasquinelli 4y ago
  hey, i don't think anyone is attacking you for owning a home, so you really don't need to defend yourself.
- xdennis 4y ago
  This is not about renting. It's just weird when some people consider themselves home-owners when they haven't actually paid for their house. Being a home owner is a great thing, but that something very few people can achieve today at an age when they can still get a hard-on.
  - nerdchum 4y ago
    agreed and it feels like redefining the word owner isn't helping identify the percentage of true homeowners. It's sort of obfuscates the whole thing.
- nerdchum 4y ago
  you still don't own your house. The bank can take it away if you don't pay them. then you have property tax, insurance, maintenance, and a huge amount in interest. My aunt is a landlord. And at the end of the day, her profit is around 20%. which means you are only paying 20% less than a renter, however, you're completely locked in and can't go anywhere. and even more unfortunate... even after your mortgage is paid off ....you'll still be paying: property tax, maintenance, insurance etc etc. forever and none of that is getting any cheaper. people lose their houses all the time because property taxes got away from them because rich people moved in and just took the neighborhood.
mercutio2 4y ago
If you own a home and have a mortgage, there is a lien on your property. There are many ways a lien could be granted on property you own; taking a mortgage, loss of a civil suit, unpaid property taxes are a few common ways. It is fine to say you don't own anything with liens on it "free and clear". The lien places limits on your ability to do certain things, mostly (quite reasonably) changing ownership. But ownership is about control, and no one ever has complete control over any physical property, so owning with a mortgage is certainly well within the sphere of what most people think of ownership as.
- nerdchum 4y ago
  in the first part you say you don't control the property because there's numerous things one can't do. them in the last paragraph you say that one doed control property? thesis does not seem cohesive to me
  - mercutio2 4y ago
    No one ever has absolute control. Control is a continuum. Ownership is a well defined concept in US society. That it doesn’t map to the absolute terminal point on the control continuum does not mean the common legal and vernacular definitions of ownership are broken.

verall 4y ago

Very silly take. If the property value changes, the loan doesn't. You're responsible for maintenance. I don't see how it's relevant that you have a loan against it. If you own your home outright, and then take out a HELOC, do you no longer own your home?

deleted 4y ago
[deleted]
- deleted 4y ago
  [deleted]
sixstringtheory 4y ago
> If the property value changes, the loan doesn't That works both ways. Google "underwater mortgage"
- verall 4y ago
  Obviously, which is why you are the homeowner and the bank isn't.
  - sixstringtheory 4y ago
    Depends on your definition of "own" I suppose. If you have a mortgage, the bank has a mortgage lien on the home, which gives them a legal right to take it from you if you don't pay. I.e. you will get kicked to the curb on an underwater mortgage if you can't make the payments any longer, but also can't afford to bridge the gap in order to sell.
    - dragonwriter 4y ago
      > If you have a mortgage, the bank has a mortgage lien on the home, which gives them a legal right to take it from you if you don't pay. I.e. you will get kicked to the curb on an underwater mortgage if you can't make the payments any longer, but also can't afford to bridge the gap in order to sell. In a non-recourse state (or, to a lesser extent, even in a recourse state) foreclosure on an underwater mortgage loans isn't a great deal for the bank; it either eliminates any chance on recovering part of the mortgage (non-recourse), or turns the amount above what can be realized in a foreclosure sale into a non-secured debt (recourse). Depending on circumstances, there's a chance they'll just choose not to do that for a very long time (much longer than would be the case either with an "above water" mortgage that wasn't being paid, or than a landlord would float a tenant that wasn't paying.) They also have a pretty big incentive to approve a short sale on an underwater mortgage, since you'll probably get a better price than a foreclosure sale and cost them less money than foreclosing and trying to sell. (Have I been underwater, gone an extended period of time withput paying a mortgage both while living in the home and then after moving out, getting a buyer, and proposing and waiting for approval for a short sale, in a non-recourse state? Yes, yes I have.)
      - sixstringtheory 4y ago
        Dang, that sounds stressful. Hope you came out the other end of that ok! And thanks for the extra context and sharing your experience.
nerdchum 4y ago
value doesn't mean anything in this case. what matters is that someone can take away your property if you don't do what they say. That's not ownership.
- medvezhenok 4y ago
  Same thing happens in a paid off house if you don't pay your property tax.
  - nerdchum 4y ago
    Exactly. You're a SERF to the government forever! People lose their house often to runaway property taxes. This should anger people more.
    - verall 4y ago
      This is unhinged. If purchasing a piece of land means that it stays within your family forever with no additional payments or taxes, that's feudalism.
      - nerdchum 4y ago
        I don't think you understand. feudalism. you should google it. feudalism is NOT owning your land because the government owns it and you pay them for the use of the land which is exactly what we have now.
        verall 4y ago
        If the government exists to protect property rights through use of force, and property owners have access to that system without paying taxes, what do you call the rest of us, who have to pay rents to those property owners and taxes for the government? Not serfs? Even feudal lords had to protect their own land and were also expected to protect their serfs, lest their serfs' foods be given to raiders rather than their lord.

beisner 4y ago

No, they own both an asset and a liability, secured by that asset.

Shaggy2000 4y ago
That's an even worse position to be honest
- bluGill 4y ago
  Depends on if you are able to pay it off or not.

deleted 4y ago

[deleted]

strontian 4y ago

You do own it, you’re just also short a bunch of dollars spread into the future.

bluGill 4y ago
Not that much as you need to pay rent otherwise. With inflation in a dozen years you have more money than renters. Of course how valuable this is depends on how long you live and a number of other factors.

User23 4y ago

By that view you never own land since you’re always on the hook for property tax, which is a kind of rent. I suppose there are rare cases of allodial title. Nevada used to let you buy an allodial title that couldn't be inherited. It was useful for doing things like getting a second mortgage from a bank that wasn't aware of the law and then immediately defaulting and telling them to get bent because they can't legally foreclose on an allod. Needless to say lobbyists successfully put a stop to that.

xdennis 4y ago
Paying taxes doesn't mean you don't own it. If you don't pay your taxes you go to prison, they don't take your house away.
- User23 4y ago
  Tax lien foreclosures and tax deed sales are absolutely a thing. You certainly can lose your house for not paying property taxes.
- yucky 4y ago
  This isn't true. If you don't pay your property taxes you do not go to prison, you just lose the property.
lo_zamoyski 4y ago
> By that view you never own land since you’re always on the hook for property tax, which is a kind of rent. Bad comparison. That both failing to pay off a loan or pay property taxes can lead to foreclosure is a superficial similarity. Property tax isn't paying off a debt you owe a bank for a loan used to buy the house. It's merely a tax collected to cover municipal expenses that's calculated based on the value of your house. Now as to whether the bank owns the house you bought using a loan, morally there is a certain practical truthfulness to that statement, perhaps, and for practical purposes is may be somewhat pedantic making distinction that determine "true" ownership. But strictly speaking, as with borrowing in general, if a loan is money you've borrowed that you then use to buy an asset like a house, then what you owe the lender isn't the house, but the value of the loan. If I lend you $20, and you buy a book with that money, you don't owe me the book, you owe me $20.

fasthands9 4y ago

I feel like its a useful metric for lots of issues - especially public policy issues. Even if the bank "owns" the home you get the tax breaks for it and behave like someone who has a self-interest of increasing the value of it.

nerdchum 4y ago
none of that matters though to the true definition of ownership which is complete control over the object people.seem.to want to identify as an owner as it makes them feel good.
- fasthands9 4y ago
  youre getting stuck in semantics. if you own a house in the US you still pay property tax and are subject to the rules and regulations around it anyway. the point of these stats is to know who is a renter and who has property they own.
  - nerdchum 4y ago
    I completely agree. After you pay off the bank you STILL don't own the property thanks to the government who can take it away. a homeowner is merely a serf for the government property taxes.

smt88 4y ago

You seem to be using a definition of "own" that differs from the one everyone else is using. The bank can't gain or lose money when your home changes in value. It can't enter your home without your permission, change the paint color, or sell your home. It can do these things if you become unable to pay for your mortgage. Your home is security for them, but you could buy a house with a loan secured by anything else. It's not uncommon for wealthy people to borrow against their stocks and then buy a home "in cash". In that situation, you'd never say "the bank owns their home" just because they owe the bank a bunch of money.

onlyrealcuzzo 4y ago
Importantly, it doesn't raise your rent 3-10% every year. Your property tax & insurance (usually less than 1/4th of your payment) goes up 2-3% (in most places).
- S201 4y ago
  > Your property tax & insurance [...] goes up 2-3% (in most places). Heh, or in my case: 30% this year.
  - hdespiritu 4y ago
    If it's your primary residence, the homestead tax credit can offset that increase substantially https://smartasset.com/taxes/what-is-a-homestead-tax-exemption https://smartasset.com/taxes/what-is-a-homestead-tax-exempti... OP's original point still stands. Real estate in America is designed to have many economic advantages for wealth accumulation and preservation. You might even go as far as saying the economic advantages of real estate are a byproduct of regulatory capture
    - nerdchum 4y ago
      > economic advantages of real estate are a byproduct of regulatory capture This seems correct to me. I don't think it's been specifically designed to be a store of wealth.

nosequel 4y ago

Spot the renter in SF/Seattle/LA/NYC mad about wording around people "owning" a house. Yes I have a mortgage, but at least my monthly payments are 98.01% going to my own future. Renting doesn't even compare, just throwing money at someone else's retirement.

pasquinelli 4y ago
hey, i don't think anyone is attacking you for owning a home, so you really don't need to defend yourself.
xdennis 4y ago
This is not about renting. It's just weird when some people consider themselves home-owners when they haven't actually paid for their house. Being a home owner is a great thing, but that something very few people can achieve today at an age when they can still get a hard-on.
- nerdchum 4y ago
  agreed and it feels like redefining the word owner isn't helping identify the percentage of true homeowners. It's sort of obfuscates the whole thing.
nerdchum 4y ago
you still don't own your house. The bank can take it away if you don't pay them. then you have property tax, insurance, maintenance, and a huge amount in interest. My aunt is a landlord. And at the end of the day, her profit is around 20%. which means you are only paying 20% less than a renter, however, you're completely locked in and can't go anywhere. and even more unfortunate... even after your mortgage is paid off ....you'll still be paying: property tax, maintenance, insurance etc etc. forever and none of that is getting any cheaper. people lose their houses all the time because property taxes got away from them because rich people moved in and just took the neighborhood.

mercutio2 4y ago

If you own a home and have a mortgage, there is a lien on your property. There are many ways a lien could be granted on property you own; taking a mortgage, loss of a civil suit, unpaid property taxes are a few common ways. It is fine to say you don't own anything with liens on it "free and clear". The lien places limits on your ability to do certain things, mostly (quite reasonably) changing ownership. But ownership is about control, and no one ever has complete control over any physical property, so owning with a mortgage is certainly well within the sphere of what most people think of ownership as.

nerdchum 4y ago
in the first part you say you don't control the property because there's numerous things one can't do. them in the last paragraph you say that one doed control property? thesis does not seem cohesive to me
- mercutio2 4y ago
  No one ever has absolute control. Control is a continuum. Ownership is a well defined concept in US society. That it doesn’t map to the absolute terminal point on the control continuum does not mean the common legal and vernacular definitions of ownership are broken.