How to Notify the Mortgage Lender

Call the mortgage lender's customer service number and say: "I need to report the death of the borrower [name] on [date]. I am the [relationship] and executor of the estate." They will ask for the loan number, a death certificate, and letters testamentary. The lender will update their records and tell you about next steps for the loan.

A common fear is that the lender will demand immediate full repayment of the mortgage. In most cases, this will not happen. The Garn-St Germain Depository Institutions Act of 1982 prohibits lenders from exercising a due-on-sale clause when a property transfers to a surviving spouse, child, or relative of the deceased borrower. This means you can continue making the regular monthly payments and keep the property without refinancing. If payments will be difficult in the short term, ask the lender about forbearance — a temporary pause or reduction in payments, typically for 3 to 6 months.

If the property will be sold as part of settling the estate, keep making mortgage payments until the sale closes to avoid default and foreclosure proceedings. If the estate cannot afford the payments and the property is underwater (worth less than the mortgage balance), consult with a real estate attorney about options including a short sale or deed in lieu of foreclosure. If the deceased had mortgage life insurance (a separate product that pays off the mortgage upon death), file that claim immediately — it can eliminate the mortgage payment entirely.