Short answer

An inherited house is not a probate asset when ownership passes automatically at the decedent’s death through a nonprobate mechanism (for example, joint tenancy with right of survivorship, a properly recorded transfer-on-death deed, or a named beneficiary). Even if the property is nonprobate, the mortgage lien usually remains. You (or someone living in the house) can often make mortgage payments to prevent foreclosure, but who can act, what the lender will accept, and whether the loan can be modified or assumed depends on how title passed, the loan documents, and the lender’s policies. If the property is still part of the estate (probate asset), the personal representative typically controls payments and conversations with the lender.

Detailed answer — How title, probate, and liens work in Montana

1) How a house becomes a nonprobate asset

Property avoids probate when ownership passes automatically by operation of law or by a valid, recorded nonprobate transfer. Common examples:

• Joint tenancy with right of survivorship or tenancy by the entirety — the surviving co-owner automatically owns the property on death.
• Transfer-on-death deed (TODD) or beneficiary deed — if Montana law recognizes and the deed was executed and recorded properly, the named beneficiary gets title at death without probate.
• Deed that conveys property to a living trust — property titled in the trust stays outside probate.
• Designated beneficiary ownership under any statute or contract that transfers ownership on death.

If title lists the decedent alone and none of the above applies, the property is likely a probate asset and will be administered through the decedent’s estate unless an exemption applies.

For the Montana Code and statutory provisions related to real property and probate, view the Montana Code Annotated titles and chapters on the state website: Montana Code Annotated (MCA) table of contents. For practical court forms and information about probate procedures in Montana, see the Montana Judicial Branch site: Montana Courts.

2) What happens to the mortgage and lien after death

A mortgage or deed of trust is a lien on the property. The mortgage does not disappear when the borrower dies. The lender still has the right to collect payments and, if payments stop, to enforce the mortgage (which may include foreclosure) according to the loan documents and applicable law. Whether an heir or beneficiary becomes personally responsible for the loan depends on whether they assume or refinance the loan and the loan’s terms.

3) Who can make mortgage payments and when the administrator (personal representative) is needed

If the property passed outside probate (for example, to a surviving joint owner or by a valid beneficiary deed), the new owner can usually make payments and deal directly with the lender. An administrator or personal representative is generally not required for a nonprobate transfer because title already passed to the beneficiary.

If the property is still in the decedent’s name and is a probate asset, the personal representative usually has legal authority to manage estate assets, including making mortgage payments, selling property, or negotiating with the lender. Lenders often request “letters testamentary” or “letters of administration” (court-issued documents) to verify the personal representative’s authority before discussing or modifying loan terms.

4) Practical steps you can take right now to avoid foreclosure

1. Confirm how title passed. Search the county recorder’s office for the deed and look for joint tenancy language, a TOD deed, trust deed, or other instrument that names a beneficiary.
2. Find the mortgage/lender info. Locate mortgage statements, the loan number, and loan servicer contact information. If you cannot find papers, call likely servicers or check credit/bank records.
3. Contact the lender immediately and explain the borrower’s death. Tell them who is occupying the property and whether there is a surviving co-owner or beneficiary. Ask what documentation they need to accept payments or to consider loss-mitigation options.
4. Make payments if you can. Lenders usually accept payments from occupants or heirs to keep the loan current. Keep precise records and get written receipts. Continuing to make payments is often the simplest way to stop or delay foreclosure.
5. Ask whether the loan is assumable or eligible for modification. Most modern mortgages include a due-on-sale clause, but federal law (and lender policies) can affect enforcement in transfers by devise or descent. Ask the lender whether they will allow a loan assumption or modification in these circumstances.
6. If the property is probate property, you (or others) should encourage the estate executor to act promptly, since the executor’s authority will often be required to negotiate with the lender or to sell the property.

5) Risks and limits — what to watch for

• Lender requirements. Even if you continue paying, some lenders will ask for proof of authority to make decisions about the loan (especially for loan modifications or foreclosure alternatives).
• Title vs. obligation. Paying the mortgage does not automatically give you ownership. If you are not on title, you may pay but still lack legal ownership unless the title is transferred or you acquire it through the estate or other agreement.
• Foreclosure process and timing vary. If payments stop, the lender can move to enforce the mortgage according to the loan documents and applicable Montana law — delays or protections may apply, but you should not rely on vague timelines. Contact the lender and act fast.
• Tax and estate consequences. Receiving property by inheritance has tax and estate-administration implications. The estate’s executor may need to address outstanding mortgage debt as part of estate administration.

When to get legal help

Consider talking with an attorney if any of the following apply:

• Title is unclear or competing claimants exist.
• The lender refuses to accept payments from the beneficiary or occupant without an administrator’s paperwork and the estate lacks a timely administrator.
• You face imminent foreclosure and need help negotiating loss mitigation, sale, or a loan assumption.
• There are disputes among heirs about sale or occupancy.

A Montana probate or real property attorney can review title documents, the mortgage, and any probate filings and advise you on the quickest path to secure ownership or prevent foreclosure.

Helpful hints

• Start by pulling the deed at the county recorder’s office (or online). The deed language tells you whether the property passed outside probate.
• Keep paying the mortgage if you can. Payment is the fastest way to prevent foreclosure while you sort title questions.
• Ask the lender what proof they need to accept payments or to modify the loan (examples: death certificate, heirs’ ID, letters testamentary).
• If someone is living in the house but not on title, get a written agreement about payments and occupancy to reduce later disputes.
• Document every phone call and send emails or certified letters to the lender so you have a paper trail if a dispute or foreclosure arises.
• Search the Montana Code Annotated online for statutes related to real property and probate at: https://leg.mt.gov/bills/mca_toc/.