Who Pays the Mortgage on a House in Probate in California?

When a loved one passes away and leaves behind a house, one of the first questions families in Los Angeles County and Orange County often ask is:

“Who’s responsible for the mortgage now?”

It’s a great question and one that has both legal and financial implications. Whether you're the executor of the estate, a surviving family member, or a potential heir, understanding how mortgage payments are handled during probate is crucial to avoiding foreclosure, protecting the estate, and keeping your options open.

Does the Mortgage Go Away When Someone Dies?

No — the mortgage doesn’t disappear.
Even if the borrower passes away, the loan stays with the property. The lender still expects payments to be made. If they aren't, the property can go into default and potentially face foreclosure, regardless of whether probate is finished.

This applies to both primary residences and investment properties across Southern California, including high-cost areas like Pasadena, Anaheim, or Long Beach.

So, Who Pays the Mortgage During Probate?

1. The Estate Usually Pays

During probate, the estate is responsible for keeping the mortgage current. If there are funds in the decedent’s bank accounts, those are typically used first.

2. The Executor or Administrator Handles Payments

The court-appointed representative (executor or administrator) is responsible for managing the estate's financial affairs, which includes paying the mortgage using estate assets.

3. Sometimes the Heirs Pay Temporarily

In some cases, heirs will choose to keep the mortgage current out-of-pocket to avoid damage to the estate or delays in selling the home — especially in areas like Los Angeles County or Orange County where property values can drop significantly due to neglect or market timing.

What Happens If No One Pays the Mortgage?

If no payments are made, the lender will typically start foreclosure proceedings within a few months. That can force the estate to:

• Sell the home under pressure

• Lose equity due to liens or legal fees

• Damage the heirs’ potential inheritance

This is why it’s critical to notify the lender of the borrower’s passing, explain that the property is in probate, and maintain open communication. Some lenders will work with estates, especially if there’s a plan in place.

Can the Executor Use Personal Funds?

Executors are not required to use personal funds to cover the mortgage. In fact, doing so without proper court documentation can create confusion or reimbursement issues later.

That said, some family members do step in temporarily, especially when there's equity worth protecting.

If someone does cover payments, they should keep detailed records and work with the estate attorney to determine how and when they’ll be reimbursed — either through court-approved expenses or through proceeds from the sale.

Does the Bank Automatically Take the House?

No. California has protections in place.
Federal law also restricts lenders from immediately foreclosing after a borrower’s death. The Garn-St. Germain Act allows heirs to assume the mortgage under certain conditions.

However, if the home sits unpaid and unmanaged for too long, foreclosure is still possible — even during probate.

Can the House Be Sold While in Probate?

Yes and often that’s the best solution. Selling the home can:

• Stop the financial bleeding

• Pay off the mortgage in full

• Allow remaining equity to be distributed to heirs

In Los Angeles and Orange County, where home values are high but interest rates and taxes can make holding costs steep, selling is often the most practical way to move forward.

Executors with full authority under the Independent Administration of Estates Act (IAEA) can typically sell without court confirmation, which speeds up the process.

How We Help Families Avoid Probate Mortgage Mistakes

At The Borges Real Estate Team, we specialize in helping families manage probate real estate across Los Angeles County and Orange County. We’ve helped many clients keep properties out of foreclosure, coordinate sales to pay off outstanding mortgages, and protect the equity their loved ones worked so hard to build.

If you're unsure what to do about mortgage payments on a home in probate, you don’t have to navigate it alone. Let’s talk through your options.