Find out what happens to your home and mortgage in your estate after you die.
Information shared by Northwestern Mutual’s Phil Roemaat, an advanced planning attorney
Phill Roemaat tells us that “When you die, your bank accounts, real estate, businesses and other possessions are lumped together to create what’s called an estate.”
Your estate then goes into “probate”, a court proceeding to determine the value of the estate. The objective is to make sure all debts are paid before providing heirs with their inheritance.
Your mortgage is “secured” or backed by something of value, your home. When you die, secured creditors, the bank that gave you the mortgage loan, would get paid with the proceeds from the sale of the home. Anything remaining would go to your estate and then possibly your heirs.