First-Time Homebuyer FAQ: If I Have a Mortgage, Do I Own My Home?

Posted by Laine Smith on 6/3/15 1:03 PM

Home financing can be a confusing process for first-time homebuyers, including the concept of ownership after closing on a mortgage. When you purchase a home via a mortgage loan, as a borrower you are, in fact, a homeowner free to make decisions pertinent to the property (decor, renovations, construction, etc.) - but do you actually own the home you were lent money to purchase?


Simply put, yes, you do own your home but your mortgage lender does have interest in the property based on documents signed at closing. These documents are explained throughout the closing process by your closing agent and state legal obligations and rights of you and your lender, including:

  • Mortgage Note - this is legal evidence of your mortgage and is a formal promise to repay the debt of your mortgage to your lender. It explains the amount and terms of your loan and possible penalties that can be inflicted by the lender if you default on those terms.
  • Deed of Trust - this document lists the legal obligations and rights of you and the lender.  It also states the lender's right to foreclose on the home if you default on the loan.

While your home serves as collateral for your mortgage, as long as the terms of that mortgage are met you, as a borrower, are the owner of your home.

For more information about purchasing and financing your first home, download our free Mortgage 101 Handbook, a great resource for first-time homebuyers.

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