California: How to Take Over a Deceased Parent’s Mortgage — FAQ | California Probate

Detailed answer — Can you take over your deceased parent’s mortgage in California, and what steps will get you there?

Short answer: you cannot automatically cancel a mortgage when the borrower dies. The loan stays with the property or the borrower’s estate. To keep the home and the mortgage in your name, you must (1) become the legal owner of the property, and (2) get the lender’s approval to assume or refinance the loan (or have the estate pay off the mortgage). Whether you can do that without triggering the lender’s due‑on‑sale rights depends on the lender and federal law.

How ownership of the house passes

First, find out how title to the home passes after your parent’s death. Common ways title transfers:

Joint tenancy or community property with right of survivorship — the surviving co‑owner automatically owns the home at death (no probate).
Recorded Transfer‑on‑Death (TOD) deed — the named beneficiary takes title without probate when the deed is valid and recorded.
By will or intestacy — the property passes through probate before title transfers to heirs or beneficiaries.

For information on probate and nonprobate transfers in California, see the California Courts’ probate self‑help pages: https://www.courts.ca.gov/selfhelp-probate.htm and the California Probate Code overview: https://leginfo.legislature.ca.gov/faces/codesTOCSelected.xhtml?tocCode=PROB&tocTitle=+Probate+Code+-+PROB.

What the lender will expect

A mortgage is a debt secured by the property. After the borrower’s death, the mortgage doesn’t vanish. The lender can require timely payments, request proof of death, and ask for documentation that shows who now has authority over the property (for example, letters testamentary or a recorded deed). If payments stop, the lender can pursue collections or foreclosure under California foreclosure law (see Cal. Civ. Code §2924): https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=2924&lawCode=CIV.

Ways you can practically “take over” the mortgage

Assume the loan — some mortgages are assumable; others require the lender’s written approval. If the lender approves an assumption, they typically require a credit check and an assumption agreement that makes you liable for the loan.
Refinance the mortgage into your name — you get a new loan in your name to pay off the old mortgage. This is the most common way for a child to end up with the mortgage in their name, but it requires qualifying income/credit.
Have the estate pay off or sell the house — if the estate has cash, the executor/administrator can pay the mortgage and transfer title. Alternatively, the estate can sell the home and use proceeds to pay the lender.
Remain in the home but not assume the mortgage — you may live in the home and make payments, but unless you are on the loan or title you are not personally obligated. That risks foreclosure if payments stop.

Due‑on‑sale clause and transfers by death

Many mortgages contain a due‑on‑sale clause that allows the lender to demand full repayment when ownership changes. However, federal law includes exceptions to enforcement of due‑on‑sale clauses for certain transfers, including transfers that result from the borrower’s death to a relative who takes principal residence. See the federal statute on enforcement limits: 12 U.S.C. §1701j‑3 (Garn‑St. Germain Act). The federal provision can limit the lender’s ability to demand full repayment solely because of a transfer by death: https://www.govinfo.gov/content/pkg/USCODE-2018-title12/html/USCODE-2018-title12-chap45-subchapI-sec1701j-3.htm.

That said, the statute and its application can be fact‑specific; lenders frequently still request documentation and may offer to negotiate terms. Don’t assume the lender must automatically accept an heir as the borrower without paperwork or verification.

If the property passes through probate

If the house is part of probate, the court will appoint an executor or administrator who controls estate assets. The executor must pay valid debts (including the mortgage), then distribute property according to the will or intestacy law. To get the property, you may need to be named in the will and receive the property as an inheritance, and the executor must transfer title to you after satisfying debts. See California probate resources: https://www.courts.ca.gov/selfhelp-probate.htm.

Documents the lender or county recorder may require

Death certificate.
Recorded deed that shows you as owner (or other recorded instrument such as a TOD deed).
Letters testamentary or letters of administration (if probate applies).
Loan payoff statement or assumption/refinance paperwork if you take over the mortgage.

What to do right now — a practical checklist

Locate the deed and mortgage statement (monthly statements, loan number, lender contact).
Get multiple certified copies of the death certificate from the county where death occurred.
Check the deed: is title joint, community property with survivorship, or is there a TOD deed?
Contact the lender to tell them of the borrower’s death and ask what documentation they require and whether the loan is assumable.
If title will pass through probate, contact the executor or file for letters if you are the named executor/administrator.
If you want to keep the home, explore assumption vs refinance — speak with the lender and with mortgage lenders about refinancing rates and qualification.

Risk of foreclosure — and your rights

Stopping payments invites foreclosure. In California, lenders typically use nonjudicial foreclosure procedures governed by Civil Code provisions such as §2924. If foreclosure begins, you may have limited time to reinstate the loan, redeem the property (in limited circumstances), or negotiate a loan workout. For details, see Cal. Civ. Code §2924: https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=2924&lawCode=CIV.

When to get an attorney

Consider hiring a California probate or real estate attorney if any of these apply:

The estate goes into probate and the property is a major asset.
The lender refuses to approve an assumption or imposes terms you believe are unfair.
Multiple heirs dispute ownership or steps needed to transfer title.
Foreclosure or other creditor actions threaten the home.

California courts provide self‑help resources, but an attorney can protect rights, explain local practice, and negotiate with lenders: https://www.courts.ca.gov/selfhelp.htm.

Disclaimer: This article explains general California law and practical steps; it is not legal advice. Consult a licensed California attorney for advice about your specific situation.

Helpful Hints

Get several certified death certificates right away — lenders and the county recorder will request them.
If title is joint or there is a TOD deed, record a certified copy of the death certificate with the county recorder so the title reflects the change.
Ask the lender whether the mortgage is assumable and what documents and underwriting criteria they require.
Before making payments for a property you do not yet own, get the lender to confirm in writing what your payments mean for your legal position.
Shop for refinancing quotes early if you plan to refinance — timing can help avoid delinquency or foreclosure steps.
If the estate lacks cash to pay the loan, the executor can sell the property to pay creditors — know that the mortgage must be paid from sale proceeds.
Keep good records: written communications with the lender, copies of deeds, probate filings, and any agreements you sign.