How to assume or keep a deceased parents mortgage in South Carolina

Detailed Answer

If your father died owning a home in South Carolina and you want to take over the mortgage, you must address two separate issues: (1) how title to the house transfers to you under estate law, and (2) what the mortgage lender requires for you to become responsible for the loan. These are related but distinct steps. Below is a clear, step-by-step explanation of what typically happens and what you should do.

1) Confirm how the property will pass (title issues)

Start by determining how your father owned the home:

• If the deed named a joint owner with right of survivorship (joint tenancy or tenancy by the entirety), the surviving owner usually owns the house automatically and no probate is needed. Check the deed recorded in the county Register of Deeds.
• If the house was placed in a revocable living trust, the successor trustee will follow the trusts terms and transfer title without probate.
• If there was a last will, the executor will transfer title to whoever inherits the house through the probate process.
• If there was no will and no trust (intestate), state intestacy rules determine heirs and the estate proceeds through probate.

For more on South Carolina probate and estate law, see South Carolina Code, Title 62 (Probate, Decedents Estates, and Fiduciaries): https://www.scstatehouse.gov/code/t62.php.

2) Check the mortgage terms and contact the servicer

Even if you inherit the house, the mortgage remains a contractual obligation secured by the property. Contact the mortgage servicer immediately and tell them of your fathers death. Ask for:

• current loan balance, payment amount, and payment due date;
• whether the loan has an assumption provision and the servicers requirements for loan assumption;
• whether the loan is in default or at risk of foreclosure;
• the documentation they need (death certificate, copy of will or letters testamentary, ID).

Federal law limits a lenders ability to enforce a due-on-sale clause in some transfers at death of the borrower. See 12 U.S.C. 701j-3 (exceptions to due-on-sale enforcement): https://www.law.cornell.edu/uscode/text/12/1701j-3. That federal rule can make it harder for a lender to forcibly accelerate the loan simply because title passes by operation of law after death. Still, the lender may require an assumption application or refinancing to put the loan in your name.

3) Ways to become responsible for the mortgage

Common paths you can pursue:

• Formal assumption: Some mortgages are assumable. If the servicer permits an assumption, you usually must apply, provide credit and income documentation, and sign an assumption agreement. The lender may charge an assumption fee.
• Refinance: If the lender will not allow an assumption or you want better terms, you can refinance the mortgage in your own name (subject to qualifying for the new loan).
• Continue paying without formal assumption: If you inherit title and you keep making the payments, the borrowers estate remains technically responsible until the loan is paid, assumed, or refinanced. This approach can work short-term but risks a lender enforcing remedies if you are not on the note or if payments stop.
• Sell the property: If you cannot qualify for the loan or do not want to keep the house, selling the home and paying off the mortgage is a normal route.
• Negotiate with the servicer: You can request a loan modification, forbearance, or short sale if you cannot keep the loan.

4) Probate and the executor/administrators role

If the home must pass through probate, the personal representative (executor or administrator) has duties to the estate, including paying debts and distributing assets. The representative often must:

• notify the mortgage servicer and provide a death certificate;
• use estate funds or the sale of estate assets to pay debts if necessary;
• transfer title to heirs once debts are addressed and the court authorizes distribution.

Heirs should coordinate with the personal representative. If you are an heir but not the personal representative, you may need the representatives cooperation to transfer title so you can pursue an assumption or refinance.

5) Practical documents you will likely need

• Certified copy of the death certificate;
• Mortgage statement and loan account number;
• Recorded deed showing current ownership;
• Copy of the will or proof of appointment as personal representative (letters testamentary/letters of administration);
• Proof of income and credit information if applying to assume or refinance.

6) Timing, risks, and quick actions

Act quickly if payments are late. Foreclosure timelines vary, and missed payments can trigger lender action. If the servicer says the loan must be paid, insist on written confirmation of options and deadlines. If you intend to keep the home, start the assumption or refinance process as soon as possible.

Helpful Hints

• Gather documents first: death certificate, deed, mortgage statement, and any estate planning documents.
• Contact the mortgage servicer early and keep a written record of all communications.
• Check the deed for words like “joint tenancy,” “right of survivorship,” or “tenancy by the entirety.” Those change how title transfers.
• If the loan is in default, ask about loss-mitigation options (modification, forbearance, short sale) immediately.
• If you plan to assume, be prepared for a credit check and income verification; the lender may require you to qualify financially.
• If you inherit through probate, coordinate with the personal representative; do not attempt to transfer or encumber title without proper authority.
• Consider refinancing if assumption is not allowed or if your credit qualifies you for better terms.
• When in doubt, consult an attorney experienced in South Carolina probate and real estate law for help with title transfer and dealing with the lender.

Important links: South Carolina code on probate and estates: https://www.scstatehouse.gov/code/t62.php. Federal rule on due-on-sale exceptions: https://www.law.cornell.edu/uscode/text/12/1701j-3.

Next step: If you want help evaluating your situation, gather the documents listed above and consult a South Carolina probate or real estate attorney. An attorney can confirm how title passes, explain the estates duties, and negotiate with the servicer or prepare an assumption or refinance strategy.

Disclaimer: This article provides general information about South Carolina law and common procedures. It is not legal advice and does not create an attorney-client relationship. For advice about your specific facts and legal options, consult a licensed attorney in South Carolina.