Who Pays the Mortgage, Taxes and Bills on a House in Probate?

When a loved one passes away, the house does not pause. The mortgage, property taxes, insurance and utilities keep coming due, and probate can take months.

I'm Jeanette Nelson, a REALTOR® with Jeanette Nelson Real Estate, Keller Williams Realty, serving Orange County, Huntington Beach, Costa Mesa, Fountain Valley, and surrounding areas. When families call me about a parent's house in probate, the bills are often one of their first worries. A clear plan for who pays what, and from where, takes a lot of stress off your family.

This is general information, not legal or tax advice. A probate attorney and a CPA are the right people to guide your family's specific situation.

The personal representative. California Probate Code section 9650 says the personal representative has a right to possession of the estate and shall pay taxes on, and take all steps reasonably necessary for the management, protection and preservation of, the estate in their possession.

California Courts self-help explains that the personal representative must give formal notice to creditors, and if there is money to pay the estate's debts, the representative pays them from the estate.

Generally, no. The Consumer Financial Protection Bureau (CFPB) explains that when someone dies, their debts are generally paid from their estate, and no one else generally has to repay them. The CFPB lists exceptions, such as if you co-signed the loan or were a joint account holder.

The CFPB also explains that serving as executor or administrator does not make you responsible for paying the debts with your own money, unless the debt is also yours.

The mortgage stays attached to the house. If payments stop, the lender can eventually take action against the property, so keeping payments current protects the estate's equity.

Federal servicing rules help heirs. Under the CFPB's Regulation X, when a servicer learns that a borrower has died, it must promptly communicate with potential successors in interest and tell them what documents it needs to confirm their status. A confirmed successor in interest is generally treated as a borrower for the servicing rules.

My article on inheriting a house with a mortgage explains your options in more detail.

Property taxes keep coming due on the regular schedule. The Orange County Treasurer-Tax Collector explains that the first installment of secured property taxes is due November 1 and delinquent after December 10, and the second is due February 1 and delinquent after April 10. A late installment adds a 10% penalty, plus a $23 cost on the second installment.

If a bill is still unpaid after June 30, the Treasurer-Tax Collector says the account defaults and additional penalties are added each month. Make sure someone receives the tax bills, especially if mail was going to your loved one's address.

Insurance. Keep the homeowners policy in force and tell the insurer about the death. The California Department of Insurance's residential insurance guide lists losses to a house vacant 60 days or more among losses a policy may not cover, so ask the insurer what it requires for an unoccupied home.

Utilities. Keep the power and water on if the house will be shown, inspected or protected from damage. Turning everything off can create other problems.

Maintenance. Basic upkeep, like yard care and fixing leaks, is part of protecting the estate.

This is common. The house may be the estate's main asset. Families often handle it by:

1. Using estate bank funds once an estate account is set up.
2. Having a family member advance payments, with careful records, after asking the attorney how reimbursement would work.
3. Planning a sale of the house through probate, so proceeds can pay debts and costs.

Keep receipts for every payment. My article on court confirmation in a probate sale explains how a probate sale can work, and our probate sales page explains how I help families. You can also read do I need probate to sell an inherited house.

If your family is carrying a house through probate, I'd love to have a private planning conversation with you and your family about the house, its upkeep and your options, at a pace that feels right. Call or text me at 714.366.8575 | DRE: 01397168, or contact me. Jeanette Nelson is a REALTOR® with Jeanette Nelson Real Estate, Keller Williams Realty, serving Orange County, Huntington Beach, Costa Mesa, Fountain Valley, and surrounding areas.