What happens to a mortgage when the borrower dies?

When a homeowner dies before paying off their mortgage, the debts are covered by inheritors or money made from the sale of the house.

Last updated:

warning icon Warning: your home may be repossessed if you do not keep up repayments on your mortgage.
When a mortgagee passes away, the mortgage lender has the right to demand the full amount of the mortgage to be repaid, or it may continue to accept monthly repayments.

If these cannot be met by the borrower’s remaining relatives or inheritors, the lender can ask for the property to be sold in order to repay whatever is owed to it.

What happens to the property?

The executor of the will will use any assets to pay off remaining debts. Depending on how much is owed, this could potentially involve selling the property.

If the inheritor chooses to keep the property with a mortgage, they’ll have to make monthly repayments, whether they’re living there or letting it out. A mortgage lender will assess their ability to repay the mortgage loan, if this is what is decided.

Who pays for a joint mortgage after one person dies?

There are a few scenarios which involve the ownership of a joint mortgage.

If you owned the property under “joint tenancy”, you’ll inherit the property outright. This means that any debt, such as mortgage repayments, will be your responsibility.

If you owned the property as a “tenancy in common”, the owner of the share held by the deceased should be named in their will. This person may be you, in which case you’ll own the property outright.

However, it may be the case that their share of the property is given to someone else or used to pay off any other outstanding debts.

If there is no will, it is up to the law to determine who will inherit the deceased’s share of the property. In this instance, the lender may be granted rights.

We exist to help you find better. The offers we've compared on this page are from a range of products whose details we can track; we don't cover every product on the market...yet. Unless we've indicated otherwise, products are shown in no particular order or ranking. The terms "best", "top", "cheap" (and variations of these) aren't product ratings, although we always explain what's great about a product when we highlight it; this is subject to our terms of use. When you make major financial decisions, it's wise to consider getting independent financial advice. Always consider your own financial circumstances when you compare products so you get what's right for you.

Was this content helpful to you? No  Yes

Ask an Expert

You are about to post a question on finder.com:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder.com provides guides and information on a range of products and services. Because our content is not financial advice, we suggest talking with a professional before you make any decision.

By submitting your comment or question, you agree to our Privacy and Cookies Policy and Terms of Use.

Questions and responses on finder.com are not provided, paid for or otherwise endorsed by any bank or brand. These banks and brands are not responsible for ensuring that comments are answered or accurate.
Go to site