Basic Information About Home Loans and “Teitoken” (Mortgage Right)

GUIA DESIGN OFFICE
22 時間前
読了時間: 2分

When you buy a home in Japan using a home loan, a Teitoken (抵当権) may be registered. This is a difficult Japanese word, but it is a common system for home loans.

Teitoken (抵当権)

A Teitoken is the right of the financial institution that lends you the home loan. It uses the land and building as security in case you cannot continue paying the loan.

“Security” means something that helps the lender recover the money it lent if you cannot repay the loan.

Simply put, if your loan payments are late many times, or if you do not make payments for a long time, you may lose your home. The bank may take and sell your home to recover the loan money.

You Can Continue Living in Your Home While You Repay the Loan

If you make your loan payments as promised, you usually do not have to leave your home just because there is a Teitoken.

In simple terms, you borrow the money and repay it by the agreed payment dates. If you can do this, there is no problem.

If It Becomes Very Difficult to Repay the Loan

Sometimes it may become hard to make payments because of illness, unemployment, or lower income.

If late payments continue, the bank may discuss changing your payment plan. Other options, such as a voluntary sale or a court auction, may also become necessary.

However, if you feel that payments are becoming difficult, do not ignore the problem. Please contact your financial institution as early as possible.

If you explain your situation properly, the bank can think about possible solutions with you. The worst thing is to ignore the bank or not report your situation.

Summary

A Teitoken (抵当権) is a security right for the financial institution that gives the home loan.　Even if there is a Teitoken, the person who bought the home is still the owner.

If you repay the loan normally, you can usually continue living in the home. If repayment becomes difficult, talk to your financial institution early.