Under Louisiana's mortgage system, who holds title to the property during the loan?

In Louisiana's mortgage system, the borrower holds the title to the property during the loan. This is a distinctive feature of Louisiana's legal framework, which is influenced by its civil law tradition.

When a borrower takes out a mortgage, they retain ownership of the property and possess the title. The lender, while having a secured interest in the property, does not hold the title itself. Instead, they have the right to enforce the mortgage in the event of default, which can lead to foreclosure. This system allows borrowers to continue to possess and use their property even while they owe money on the mortgage.

The distinctions among various roles in this context are significant. The seller is typically not related to the ongoing mortgage arrangement once the sale is complete. Similarly, the term "mortgagee," which generally refers to the lender or the entity that holds the mortgage, does not hold title to the property but instead has a security interest. Thus, understanding the roles of each party is crucial in this unique legal system.