Detailed Answer
Short answer: possibly—but only if the person with legal authority over the estate follows Louisiana succession rules and resolves the mortgage and creditor issues first.
In Louisiana, the estate’s property does not automatically become free to sell simply because a family member wants to sell it. The person who can act for the estate is the personal representative: an executor named in the will (if the decedent left one) or an administrator appointed by the probate court when there is no valid will. That representative must have legal authority (letters testamentary or letters of administration) before selling immovable property such as a house.
Key legal points you need to understand:
- Authority to sell. The sale of a decedent’s immovable property normally requires either clear authority in the will, unanimous written agreement by all heirs, or court approval. If a named personal representative has been appointed by the court and issued official letters, they generally can act on behalf of the estate subject to any court supervision or will terms.
- Mortgage stays attached to the property. A mortgage is a security interest on the immovable. Selling the house does not automatically cancel the mortgage. A buyer’s lender will usually require the mortgage be paid off as part of closing, or the buyer may take the property subject to the mortgage if the lender agrees. The estate (through the sale proceeds) normally pays the mortgage payoff, and any remaining sale proceeds distribute to heirs after creditor claims, taxes, and costs are paid.
- Creditors and priority. Mortgage lenders are creditors of the succession. If the estate has enough liquid assets or sale proceeds, the mortgage is paid from those funds. If the mortgage balance plus other debts exceed the estate’s assets, the estate may be insolvent and the sale process changes—creditor priorities and court-supervised liquidation rules govern what happens next.
- Court supervision when required. If heirs do not agree, or if the will does not clearly authorize a sale, the personal representative will usually need a court order approving a judicial sale. In contested or complex situations, judges often supervise the sale process to ensure creditor and heir rights are protected.
Practical consequences of selling during probate:
- If you can obtain the personal representative’s authority (and any necessary court approval), you can list and sell the house while probate is pending. The buyer’s title search will reveal the mortgage and the probate status. Closing agents will insist on a clear plan for paying the mortgage out of sale proceeds.
- If the mortgage balance exceeds the property value or the estate lacks funds, heirs might have to decide whether to contribute funds to satisfy the mortgage, allow the lender to foreclose, or seek court permission for other disposition options.
- Buyer lenders commonly require a payoff statement and lien release at closing. The closing agent usually obtains the mortgage payoff and records the satisfaction of mortgage so title transfers free of that lien to the new owner (or subject to a new mortgage if the buyer finances).
Where to find the governing law: Louisiana’s succession rules and property laws apply. You can review the state code and statutes through the Louisiana Legislature’s website (search terms “succession” and “mortgage”): https://legis.la.gov/Legis/LawSearch.aspx?search=succession and https://legis.la.gov/Legis/LawSearch.aspx?search=mortgage. These pages link to the applicable Civil Code and statutory provisions that govern succession administration and security interests.
Common scenarios and what typically happens
1) Testate succession (there is a will and an executor)
If the will names an executor and the court has issued letters testamentary, the executor may market and sell the house if the will or the court allows it. The executor must ensure the mortgage is paid at closing from sale proceeds or obtain lender approval to transfer subject to the mortgage.
2) Intestate succession (no will; administrator appointed)
The court appoints an administrator who must follow the court’s procedures to sell immovable property. Heirs may need to authorize the sale or the administrator may seek a judicial sale order. Mortgage payoff remains an obligation of the estate.
3) All heirs agree to the sale
If all heirs sign a written agreement allowing the sale, it can often proceed faster—still subject to proof of authority and lender payoff requirements. Even with agreement, you still must ensure creditors (including the mortgage) are properly paid.
4) Estate is insolvent or mortgage exceeds value
If debts (including the mortgage) exceed estate assets, the administrator must follow estate liquidation rules and creditor-priority rules. A sale may be ordered to pay secured creditors (like mortgage lenders). If foreclosure occurs, heirs typically do not receive any proceeds unless there is surplus after the mortgage and creditor claims are paid.
What steps you should take now
- Identify who is the personal representative (executor or administrator) and confirm they have court-issued authority (letters testamentary/administration).
- Get a mortgage payoff quote from the lender and request the mortgage balance and any acceleration or fees. Notify the lender of the decedent’s death and the probate action.
- Obtain an up-to-date title report and confirm all liens and encumbrances on the property.
- If heirs all agree, document that agreement in writing. If they do not agree, the personal representative should seek a court order before attempting to sell.
- Work with a probate attorney or real estate attorney experienced in Louisiana succession law. They can prepare required court filings, if any, and coordinate with the closing agent to ensure mortgage payoff and lien releases at closing.
- Disclose the probate status to any prospective buyer and the buyer’s lender so the closing process can account for probate requirements.
Helpful Hints
- Get the official letters from the probate court before listing the property. A buyer’s lender or title company will ask for them.
- Request a written mortgage payoff early. Payoff amounts change daily due to interest.
- Talk to the mortgage lender about options: payoff at closing, assumption, or short sale (if the lender agrees).
- If all heirs approve, consider a written settlement that the closing agent and attorney can rely on to speed the sale.
- If estate funds are insufficient to maintain the home (insurance, taxes, utilities), inform the court or ask the personal representative for interim measures to protect value.
- Expect title and closing costs, creditor claims, and possible court costs to reduce net proceeds to heirs.
- Document everything in writing: communications with the lender, agreements among heirs, and court orders.
Quick checklist of documents the closing agent will usually require: death certificate, letters testamentary/administration, copy of will (if any), mortgage payoff statement, current title report, property tax information, and written heir consent (if applicable).
How a lawyer can help
A Louisiana probate or real estate attorney can:
- Confirm who has authority to sell.
- File petitions for court approval if needed.
- Negotiate with the mortgage lender (payoffs, assumptions, or short sale approvals).
- Coordinate closing so mortgage liens are released and proceeds distribute properly.
Important: These are general principles under Louisiana succession and property law. The exact procedures and outcomes depend on the estate’s facts: whether there is a will, who the heirs are, the mortgage terms, whether the estate is solvent, and whether heirs agree.
Disclaimer: This information is educational only and is not legal advice. Consult a licensed Louisiana attorney about your specific situation before taking action.