Who Is Responsible for a Mortgage When a Spouse Dies Without a Will?

By Larissa Bodniowycz, J.D.

Who Is Responsible for a Mortgage When a Spouse Dies Without a Will?

By Larissa Bodniowycz, J.D.

If you die without a will, someone is still responsible for paying the mortgage on your property. It might be the responsibility of the estate, the surviving spouse, the mortgage company, or even the insurance company depending on the circumstances. It's not a topic anyone enjoys thinking about, but it is important for homeowners and their spouses to understand what will happen to their home when they pass away.

Woman resting her head on her hands

A person who dies without a will means that they die intestate. When you die intestate, your estate is settled according to the laws of your state, as opposed to your individual wishes. State intestacy laws provide for the distribution of assets in a tiered system that favors the deceased individual's surviving spouse, children, and closest relatives. If you, like most people, want to control what happens to your assets after you die, this is an incentive for you to get your affairs in order and draft a will.

When you die, your debts don't magically disappear. Your estate becomes responsible for your debts , and whether you die with or without a will, your estate will go through a process known as probate. The probate process pays off your outstanding bills and debts and distributes any assets that are left over to either the beneficiaries of your will or, in the case of someone who dies intestate, to those individuals designated to receive your assets by your state's intestacy laws. The responsibility for paying your mortgage will fall on someone else when you pass away. Here are a few scenarios demonstrating who might receive that burden.

When a Surviving Spouse Must Pay

If you and your spouse own your house jointly, the responsibility for the mortgage will pass to your surviving spouse. Your surviving spouse, who will now be the sole owner of the house, will also be responsible for the entire mortgage. However, under federal law, a lender cannot force your surviving spouse to immediately pay the entirety of the outstanding mortgage upon your death.

If you are the sole owner of the home, your surviving spouse will likely inherit it pursuant to intestacy laws. Your surviving spouse may then become responsible for making mortgage payments if your estate's assets cannot cover the outstanding balance.

When a Mortgage Company or Insurance Policy Must Pay

Some mortgages will contain a provision stating that a life insurance policy will pay off the mortgage if the mortgagor passes away. Check to see if your mortgage contains such a policy. If it does, the policy should cover the amount remaining on the house.

A life insurance policy goes to your named beneficiary upon your death and is not considered an asset that is part of your estate. Therefore, any distributions from a life insurance policy do not have to be used to pay off your mortgage. However, if your spouse is the beneficiary of your life insurance policy and inherits your house, he or she can choose to use the proceeds to pay off the house.

When an Estate Must Pay

If there is no co-owner on your mortgage, the assets in your estate can be used to pay the outstanding amount of your mortgage. If there are not enough assets in your estate to cover the remaining balance, your surviving spouse may take over mortgage payments.

Federal law protects the right of a surviving spouse who inherits a house to assume the mortgage on that property, so a bank cannot just automatically foreclose on the property upon your death without giving your surviving spouse the opportunity to take over the mortgage.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.