Who Pays the Mortgage on a House I Inherit in Washington?

Your mother's will leaves you her house in Snohomish. The loan statement still arrives every month in her name, and your brother, who inherits the rest of the estate, assumes the estate will pay the balance off before the house is handed to you. He may be wrong.

Under RCW 11.12.070, when a will specifically gives someone property that has a mortgage on it, that person takes the property subject to the mortgage unless the will provides for the mortgage to be paid some other way. In plain terms, the loan comes with the house. The estate does not pay it off for you unless the will says so. Federal law then answers the next worry: in most family situations the lender cannot demand the full balance just because the house passed to you at death.

What Does RCW 11.12.070 Actually Say?

The statute is short. When real or personal property subject to a mortgage is specifically devised, the devisee takes the property subject to the mortgage, unless the will provides that the mortgage be otherwise paid. A second paragraph adds that putting a mortgage on property after signing a will does not revoke the gift, which still takes effect subject to the lien.

Two details matter. First, the rule turns on what the will says. A person who wants a child to receive a house free and clear has to say so in the will. Do not count on a general line about paying "my just debts" to do that job. No Washington case I have found settles whether it does, and a sentence that names the mortgage removes the doubt. Second, the default protects the other beneficiaries. In the opening example, the brother's share of the estate is not reduced to pay off the loan on the sister's house.

That second point can cause real friction in blended families. A will that leaves the house to a surviving spouse and the rest to children from a first marriage divides the debt as well as the assets, whether or not anyone thought about it.

What If the House Did Not Come Through a Specific Gift?

RCW 11.12.070 speaks to property that is specifically devised. Houses reach heirs in other ways, and the loan follows in each of them.

If the house passes under a transfer on death deed, RCW 64.80.100 says the beneficiary takes the property subject to the mortgages, liens, and other interests it was subject to at the owner's death. The article on transfer on death deeds in Washington covers how those deeds work.

If the house passes as part of the residue of the estate or by intestacy, RCW 11.04.250 says title vests in the heirs or devisees at death, subject to the decedent's debts, the expenses of administration, and other charges the real estate is liable for. The article on when a house legally becomes the heirs' property explains that rule. In those cases the house is also part of the property that pays the estate's debts generally, in the order explained in which gifts in a will get cut first.

Do I Become Personally Liable for the Loan?

RCW 11.12.070 says the devisee takes the property subject to the mortgage. It does not say the devisee becomes the borrower. The promissory note was your mother's contract, and inheriting the house does not put your signature on it.

What you do inherit is a house with a lien on it. RCW 11.40.135 says the creditor claim process does not affect the right of a secured creditor to realize on its security, whether or not the creditor filed a claim in the probate. If the payments stop, the lender can foreclose. So the practical choice for the person who inherits is to keep paying, refinance, or sell.

Can the Lender Call the Whole Loan Due?

Most mortgages contain a due-on-sale clause, which lets the lender demand the full balance if the property is transferred. A federal statute, the Garn-St Germain Act, limits that clause for home loans. Under 12 U.S.C. 1701j-3(d), for a loan secured by residential real property containing fewer than five dwelling units, a lender may not exercise a due-on-sale clause on certain transfers. The list includes a transfer to a relative resulting from the death of a borrower, a transfer by devise, descent, or operation of law on the death of a joint tenant, and a transfer where the spouse or children of the borrower become an owner of the property.

The federal regulation that implements the statute is narrower in one respect. Under 12 C.F.R. 191.5(b), which applies to loans on a home occupied or to be occupied by the borrower, the relative, spouse, and child exceptions cover a transferee who occupies or will occupy the property. The regulation also carves out reverse mortgages. An heir who is not a relative, or who plans to keep the house as a rental, should not assume the protection applies.

Where the protection applies, it stops the lender from accelerating the loan because of the transfer. It does not change the interest rate, forgive a missed payment, or stop a foreclosure for nonpayment.

How Do I Get the Loan Servicer to Talk to Me?

Federal mortgage servicing rules address this directly. Under 12 C.F.R. 1024.31, a "successor in interest" includes a person who receives an ownership interest in the property through a transfer to a relative resulting from the death of a borrower. Under 12 C.F.R. 1024.36(i), when a person writes to the servicer indicating that they may be a successor in interest, and identifies the borrower and the loan account, the servicer must respond with a written description of the documents it reasonably requires to confirm the person's identity and ownership interest. If the servicer has established a specific address for information requests, send the request there.

Once the servicer confirms that status, 12 C.F.R. 1024.30(d) says the confirmed successor in interest is considered a borrower for purposes of the federal servicing rules. The Consumer Financial Protection Bureau's official interpretation of that section says a servicer may not require the successor to assume the loan under state law as a condition of being treated as a borrower. Confirmation gets you information. Taking over the loan in your own name is a separate decision.

Who Makes the Payments During Probate?

The due dates do not pause while the estate is open. RCW 11.48.020 gives the personal representative the right to possession of the estate's real property, the right to collect its rents, and the duty to keep buildings in tenantable repair until the estate is settled or the property is delivered to the heirs or devisees. No statute lists mortgage payments as a duty, but in practice a personal representative with estate cash available usually keeps the loan, the insurance, and the property taxes current to protect the house from foreclosure and loss.

How those payments are accounted for at the end depends on the will. Where the house is a specific gift, the starting point under RCW 11.12.070 is that the loan belongs with the house, so the other beneficiaries may argue that loan payments made with estate money should be charged against that person's share. The statute does not answer that question directly, so it is worth settling in writing early. Where no one can carry the loan, the usual answer is a sale.

Sort Out the Loan Before the Deed

An inherited house with a mortgage raises a will question, a federal lending question, and a family question at once, and all three are easier to answer before payments are missed. The Law Office of Chad Foster advises heirs and personal representatives on inherited real estate and drafts wills that say plainly who pays the mortgage. Call 425.785.8679 to talk with a Snohomish County probate attorney.