When her parents died, Anne received all the property as the sole heir. Since she was busy, she failed to notice that the mortgage was accruing, only for the house to be repossessed by the company after a few years.
It happens, especially when estate planning isn’t in your mind.
This part of the series looks at what to do when you inherit a house with a mortgage attached to it, or when you have creditors that are after the house as well.
Your parents take on a mortgage to settle it during their lifetime. However, when the person dies, the pending mortgage on the house doesn’t just go like that – the house has to go through probate, and it is up to the beneficiary to handle the mortgage payments.
When you take up the mortgage, you need to decide whether you will take up the loan, refinance it, or to sell off the property and use part of the proceeds to clear the mortgage.
Let us look at the various options that you have, but first issues first.