Detailed Answer
When a person dies in Wisconsin and their estate enters probate, mortgage payments and utility bills do not automatically stop. Responsibility depends on who holds title to the property, whether a personal representative (the person appointed by the court to administer the estate) has been appointed, and whether estate funds are available to pay ongoing obligations.
Who is authorized to act during probate?
After the court appoints a personal representative, that individual has legal authority to manage estate property, collect assets, and pay valid debts and expenses of administration. Those powers and duties are governed by Wisconsin probate law (see Wisconsin Statutes, chapter 859): Wis. Stat. ch. 859.
Mortgage payments
– If the decedent was the borrower on a mortgage, the mortgage lender still has the contractual right to receive payments. If payments stop, the lender may pursue its remedies under the mortgage and state law (including foreclosure).
– The personal representative should locate the mortgage, notify the lender of the death, and arrange to continue payments from estate funds if the estate has money. If heirs plan to keep the property, they may refinance or assume the mortgage (if the lender permits).
– If the estate lacks sufficient cash, the personal representative must decide whether to use liquid assets to keep current on the mortgage, seek a loan or mortgage modification, sell the property as part of estate administration, or allow the lender to exercise remedies. The court may need to approve a proposed sale of estate property if required by the probate process.
Utilities (electric, water, gas, phone, internet)
– Utility accounts in the decedent’s name may be shut off if bills go unpaid. To avoid an interruption of service, the personal representative or an heir occupying the property should contact each utility company promptly.
– Utilities will generally continue service if someone (the personal representative, an heir, or an occupant) agrees to assume responsibility, provides proof of appointment (or an interim affidavit in some cases), and pays current and past-due charges. Utility companies have their own policies about documentation and deposits.
Paying bills from estate funds
– The personal representative pays estate expenses, including necessary ongoing costs to preserve estate property (such as mortgage payments, property taxes, insurance, and utilities), from estate assets before distributing inheritances. This is part of the personal representative’s duties under Wisconsin probate law (Wis. Stat. ch. 859).
– Creditors must generally present allowed claims against the estate to be paid in the statutory priority order. The timing and handling of creditor claims follow probate procedures; unresolved claims can affect the estate’s cash available to pay ongoing bills.
If someone is living in the house
– If an heir or surviving spouse occupies the property, that person should arrange to continue paying the mortgage and utilities or get the personal representative’s authorization to use estate funds for those purposes. Occupants who continue to pay may have rights to remain temporarily, but long-term possession and ownership depend on title and probate outcomes.
Short timelines and foreclosure risk
– Foreclosure timelines vary by lender and by the mortgage terms. Failure to keep the mortgage current can lead to foreclosure even during probate if payments are not made. Acting quickly—contacting the lender, checking for life insurance or escrow accounts that might cover the payment, or seeking court authority to sell the property—reduces risk of loss.
Practical documents to provide to lenders and utilities
- Certified copy of the death certificate.
- Documentation showing the personal representative’s appointment (letters of appointment or letters testamentary) or a court-issued interim authority document.
- Contact information for the personal representative and an agreement showing how bills will be handled while probate continues.
When to involve the court or a lawyer
If the estate has insufficient funds to pay necessary charges, if lenders threaten foreclosure, or if multiple people dispute who should pay or occupy the property, the personal representative may need to seek court instructions or approval for a sale, loan, or other action. For guidance on how to proceed under Wisconsin law, consult chapter 859 of the Wisconsin statutes: https://docs.legis.wisconsin.gov/statutes/statutes/859.
Helpful Hints
- Act fast: contact the mortgage lender and utility companies immediately after death to learn account status and avoid service interruptions or foreclosure steps.
- Gather documents: death certificate, mortgage statements, utility bills, insurance policies, and any loan or escrow information.
- Keep records: log all communications, payments, and receipts that relate to estate expenses.
- Use estate funds appropriately: the personal representative should pay necessary expenses from estate assets before distributing inheritances, following probate rules.
- Consider short-term solutions: lenders sometimes offer forbearance, loan modifications, or short-term payment arrangements when notified promptly.
- Don’t sign away rights without advice: occupants or heirs should avoid making binding agreements about title or selling property without legal review.
- If the estate is small, Wisconsin’s small estate procedures may provide a simpler path; check the probate chapter for eligibility and process: Wis. Stat. ch. 859.
Disclaimer: This information is educational only and does not constitute legal advice. It summarizes general principles under Wisconsin law and may not apply to your situation. For advice about a particular estate or imminent lender action, contact a licensed Wisconsin attorney or the probate court.