Detailed answer: Who pays the mortgage and utilities while an estate is probated in Alabama?

When someone dies in Alabama and their estate enters probate, the legal obligations tied to the decedent’s property do not disappear. Mortgages, utility bills, and other ongoing charges continue to be obligations of the property or the account holder. How those obligations are handled depends on three things:

1. Whether the estate has a personal representative (also called an executor or administrator) appointed by the probate court;
2. Whether the estate has sufficient cash or income to pay ongoing costs; and
3. Whether the property will remain in the estate, be transferred to a beneficiary, or be sold.

Mortgage payments

A mortgage is a secured loan against real estate. In Alabama, the mortgage lien survives the owner’s death and remains attached to the property until the loan is paid, discharged, or the property is lawfully transferred subject to the mortgage. The lender retains the right to enforce the mortgage (including foreclosure) if payments are not made. The probate process does not automatically pause mortgage enforcement.

Typical options and consequences:

• Estate pays from estate funds: If the personal representative has access to estate cash, they can use estate funds to keep mortgage payments current to preserve the property’s value.
• Beneficiary assumes or refinances: A beneficiary who will receive the property may be able to assume the mortgage, refinance, or pay off the debt (subject to lender approval).
• Sale of the property: If the property is sold during administration, the mortgage is paid from the sale proceeds at closing.
• No funds available: If the estate lacks funds and no beneficiary steps forward to pay, the lender can pursue foreclosure under Alabama law. The personal representative is not personally liable for mortgage debt unless they personally signed the loan or otherwise agreed to be responsible.

Utilities (electric, gas, water, trash, phone, internet)

Utility accounts are contractual obligations. Utility companies may shut off service for nonpayment even while probate is pending. There is no automatic rule that utilities remain paid during probate. The critical points are:

• Ongoing service to protect the property: If maintaining service is needed to preserve the property (heat in winter, prevent pipes from freezing, keep a house in saleable condition), the personal representative should pay those bills from estate funds if available.
• Transfer of accounts: A utility account in the decedent’s name can often be transferred into the estate or to a new occupant’s name; the company may require a copy of the death certificate and probate documentation.
• Termination for nonpayment: If utilities are not paid, providers may disconnect service. Disconnection may damage the property and reduce its value, which can create potential liability for the estate or complicate administration.

Role and duties of the personal representative

The personal representative has a fiduciary duty to collect, protect, and preserve estate assets and to pay valid debts and expenses of administration. That includes deciding whether to use estate funds to continue mortgage and utility payments to preserve the estate’s value. The representative usually must obtain court authority before taking extraordinary actions that affect estate assets or creditors, per Alabama probate procedures. For general information about probate administration in Alabama, the Code of Alabama and local probate courts are the primary sources: Code of Alabama (Alabama Legislature).

Creditors and payment priority

Mortgages and recorded liens are secured claims that typically take priority as a lien on the property. Utility companies may have different remedies (for example, collection or disconnection) but usually do not have a mortgage lien unless they obtained a specific lien. The personal representative must follow statutory procedures for paying creditors and expenses of administration. See the Code of Alabama for probate creditor procedures and personal representative duties: https://www.legislature.state.al.us/alacode/.

Practical example (hypothetical)

Jane Doe died owning a house in Alabama with a mortgage and active utilities. The estate has very little cash. The personal representative petitioned the probate court for appointment and then:

• Contacted the mortgage lender to explain the situation and asked about short-term forbearance or options;
• kept the homeowner’s insurance current using estate funds to avoid letting the property go uninsured;
• paid the minimum utilities needed to protect the house (heat and water to prevent damage); and
• listed the property for sale with the court’s permission and arranged for the mortgage to be paid at closing from sale proceeds.

If no one had been willing to pay the mortgage and the lender proceeded with foreclosure, the personal representative would typically not be personally liable for the mortgage (unless personally obligated), but the estate would lose the property and the lender could seek deficiency relief under Alabama law if applicable.

Where to look in Alabama law and government resources

• Code of Alabama — for probate statutes and personal representative duties: https://www.legislature.state.al.us/alacode/
• Alabama Public Service Commission — for utility regulation and consumer information: https://www.psc.alabama.gov/
• Local probate court website — for forms, filing requirements, and local procedures (visit the probate court in the county where the decedent lived).

Helpful Hints

• Immediately secure the property and maintain insurance to protect estate value.
• Open a communication line with the mortgage lender — lenders often offer temporary options (forbearance, loan modification) when informed promptly.
• Contact major utility providers quickly to learn what documentation they require to transfer accounts or prevent disconnection.
• Use estate funds for essential expenses (insurance, property maintenance, utilities) if available and appropriate under court supervision.
• If the estate lacks funds, prioritize actions that preserve value (preventing physical damage or major deterioration).
• Keep detailed records of all estate expenses and communications with lenders and utility companies; these are required for estate accounting.
• Do not sign a personal guaranty or assume personal liability for mortgage debt without legal advice.
• If you are a beneficiary and want the property, talk to the personal representative about assuming or refinancing the mortgage — lenders must approve assumptions in many cases.
• Consult a probate attorney early — even a brief consult can help avoid mistakes that could expose the estate to loss or the personal representative to liability.