Who Owns My Home If I Have A Mortgage?

Many borrowers believe that when they purchase a property by obtaining mortgage financing, they also own their home.

Technically speaking, full ownership on a property only happens once the mortgage loan amount has been paid in full.

To break this down in more detail, there are a few components of a mortgage:

A Promissory Note is a document signed by the borrower acknowledging their commitment to pay the mortgage back with interest in a specific period of time.

In addition to the terms of repayment, the Note also contains provisions concerning the rights of both parties involved in the agreement.

In some states, a Deed of Trust is used instead of a Mortgage Note. The main difference is that on a Deed of Trust there is a Trustee, which the legal title is vested to in order to secure the repayment of the loan.

There are three parties involved with a Deed of Trust:

1) Trustor – This is the borrower

2) Trustee – This is the entity that holds “bare or legal” title, and is usually the title company which holds the Power of Sale in the event of default and reconveys the property once the Deed of Trust is paid in full.

3) Beneficiary – This is the lender that is getting repaid

Deeds of Trust are easier for lenders to foreclose on than a mortgage because there is no need for a judicial proceeding.

Mortgages on the other hand, have to go through judicial proceedings, which can be expensive and time consuming.

In summary, until you have your promissory note paid in full, you are not the only one with an ownership interest in your property.

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March 22, 2010 by · Leave a Comment

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About Lester

In 1973, I graduated high school and started college. In 1977, I met and married my wife Deborah of 40 years, put on a suit and tie, and went to work for Prudential Insurance Company. In 1979, my wife was offered a great job as an advertising executive for a San Jose television station, so we moved from the Monterey Bay area to San Jose, CA. I needed a new job in San Jose and I didn’t really want to start from scratch with a new insurance office. While going to college, I had managed a Travelodge, and it was that management experience that landed my new job and started my career in real estate as a property manager. In 1980, I completed my first certification course with the National Apartment Management Accreditation Board (NAA), and in 1983, I earned my Certified Apartment Manager (CAM) designation which I keep current today. In 1984, my daughter Pearl was born, and in 1987, my son Max was born. When I was managing rental properties, many of my tenants wanted to become homeowners, so in 1988, I got my real estate sales license with the California Department of Real Estate to help them with that goal. As a new Realtor, I found that obtaining financing is the first and most important step to shopping for a home, so in 1989, I completed my first of many programs in real estate finance and loan officer training. In 2000, I stopped doing property management and real estate sales altogether, to concentrate on mortgage loan origination exclusively with Coast Capital Mortgage. In 2004, I moved from Coast Capital Mortgage to join First Priority Financial. In 2014, First Priority Financial changed its business model from mortgage brokerage and banking to just mortgage banking. To better serve my clients and stay a competitive mortgage broker, I joined C2 Financial Corporation. How many people can truly say that they love the company that they work for? I can! ◾C2 Financial Corporation is a mortgage brokerage and a banker. ◾They are A rated and accredited by the Better Business Bureau. ◾Members of National Association of Mortgage Brokers ◾FHA and VA approved. ◾Managed by principals with over 62 years experience in the mortgage industry. ◾Partners with the largest banks in the U.S. ◾One of Scotsman’s Guide Top Mortgage Originators of 2012 and 2013. I’m a lucky guy that loves my job and the people that I work with. Every day borrowers entrust me with one of the most important financial decisions of their life and I don’t take that responsibility lightly. I do what is best for my clients and know that by doing so I’m not only doing what is morally and ethically right, this belief system will result in my borrowers referring me additional clients, which is the best long-term business model. So far so good!

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