Short answer

When a homeowner dies in Kentucky, the mortgage does not simply vanish. The house remains security for the loan. To keep the home and the mortgage in your name you typically must either get the lender’s approval to assume the loan, refinance the loan into your name, or acquire title to the property through the probate or estate process and then make arrangements with the lender. Which path is available depends on the mortgage terms, whether the property passes outside probate (for example via joint ownership or a trust), and your credit and finances.

Detailed answer — step-by-step under Kentucky law

1. Gather basic documents and information.

   Get a certified copy of the death certificate, the mortgage note and deed of trust, the most recent mortgage statement (servicer name and account number), the deed to the property, any will or trust documents, and contact information for the mortgage servicer. These items determine what must happen next.

2. Contact the mortgage servicer immediately.

   Notify the mortgage servicer of the borrower’s death. Ask for a copy of the loan file and the exact payoff amount, and ask whether the loan is assumable or whether the servicer will consider a loan modification or refinancing. Many mortgages contain a “due-on-sale” clause that allows the lender to demand full payment when ownership transfers, but lenders often permit alternatives if a family member can qualify for the loan.

3. Determine how title to the house will pass.

   How the property passes will control who has authority to deal with the mortgage:

   • If the property was owned jointly with right of survivorship (joint tenancy, tenancy by the entirety), ownership may pass directly to the surviving co-owner without probate. The surviving owner should still notify the lender and provide a death certificate and recorded affidavit or other proof of survivorship.
   • If the house was held in a living trust, the successor trustee may be able to transfer title and address the mortgage according to the trust terms.
   • If the owner had a will or died intestate, the estate typically goes through probate in Kentucky. The executor or administrator (personal representative) handles estate assets and debts including the mortgage. The personal representative can seek court approval to sell the property, or the estate can transfer title to beneficiaries per the will or intestacy rules after debts are addressed.
4. Probate and the estate’s duty to pay secured debts.

   The mortgage is a secured debt against the property. In probate, debts are typically paid from estate assets before distributions to heirs. If the estate has insufficient funds to keep current mortgage payments, the personal representative must consider options such as selling the property, arranging a payoff, or asking the lender for a modification or temporary relief. Contact the local Kentucky probate court clerk for procedural steps in the county where the decedent lived.

5. Assumption vs. refinance vs. estate payoff.

   Common ways for a family member to take over a mortgage:

   • Assumption: The lender formally transfers the loan to you. The lender must approve the assumption and often requires a credit and income check. Not all loans are assumable.
   • Refinance: You refinance the mortgage into a new loan in your name. This requires qualifying on credit and income, and closing costs apply.
   • Estate payoff or sale: The estate pays off the mortgage (using estate funds or sale proceeds) and then distributes remaining proceeds to heirs. If heirs want the house, they could buy it from the estate by paying the lender.
6. If you inherit the property subject to the mortgage.

   If you receive title through probate but do not assume or refinance the loan, the mortgage stays attached to the property. You will be responsible for keeping payments current to avoid foreclosure or allowing the estate to sell the property to satisfy the debt. You should coordinate with the mortgage servicer and county clerk to make sure transfers and recordings are handled properly.

7. Know the timeline and foreclosure risk.

   Failing to make mortgage payments after the borrower’s death can lead to foreclosure under Kentucky law. Timeframes and required notices vary by lender and loan documents, so act quickly: communicate with the servicer, seek estate funding, or sell the property if necessary.

8. Consider tax and estate planning consequences.

   In many situations the property basis gets a step-up at death, which can affect capital gains tax if you later sell. Estate taxes are rarely a concern at the federal level for most families, but discuss tax implications with a tax professional or attorney.

9. When to get legal help in Kentucky.

   Hire a Kentucky probate or real estate attorney if: the lender refuses reasonable accommodation, the estate is insolvent, title is unclear, multiple heirs dispute what to do, or you need to execute a sale or refinance through the probate process. An attorney can obtain probate court authority (letters testamentary or administration), negotiate with the servicer, and record necessary transfers.

For general procedural information about probate in Kentucky, visit the Kentucky Court of Justice: https://kycourts.gov. For access to Kentucky statutes and how they may apply, see the Kentucky legislative statutes site: https://apps.legislature.ky.gov/statutes/.

Helpful Hints

• Contact the mortgage servicer immediately and provide the death certificate; ask for the account’s current balance and options in writing.
• Collect the deed, mortgage note, payment history, insurance and tax bills, and any estate planning documents (will, trust).
• Find out whether the loan has an assumability clause or a due-on-sale clause; that affects your options.
• If you intend to keep the house, get preapproved for a refinance early so you know whether you can qualify.
• If the property is in a trust or held jointly, gather the trust documents or proof of joint ownership to avoid unnecessary probate.
• Ask the county clerk or the probate court clerk in the county where the decedent lived for local probate filing instructions and forms.
• Keep records of all communications with the lender and any payments you make on the loan after the owner’s death.
• If multiple heirs want the house, formalize the arrangement in writing or in probate court to avoid future disputes.
• Consider short-term solutions (for example, temporary forbearance or repayment plans) if you need time to refinance or sell.