Eli5: Why do banks own houses?

Question

When and why did banks start owning houses and land? When did mortgages start?

In: 3

Answer 1

Banks don’t “own” like I think you’re thinking. They loan someone money yo buy property but hold a lien until paid off. So they only way a bank would own it is if it is foreclosed on and then the bank would just sell it to someone else to get their principle back.