My loved one passed away without a will or survivoring spouse, only grown children. The deceased is the only name on the house deed and there is still an outstanding mortgage that will not be paid by insurance. the house is probabaly not worth what's owed, maybe, but probably not. should we open an estate? will all creditors, including doctors and hospitals try to seize the house for payment? if so then i know it will not be worth what's owed. if we want to live in the house for a few months can we? how long will we have before creditors try to foreclouse?
First of all, I am sorry for you loss. Times like this can be tough.
You have a few different issues at play here. In Tennessee, real estate passes outside of probate to the heirs at law (if there is no will) which in your case would be the children. However, this is subject to the claims of creditors. If you open an estate and give all known creditors 4 months written notice and they do not file a claim with the probate court, then those creditors do not have to be paid. You will have to open an estate in order for any other assets to find their way to the children. You would also have to open an estate to establish legally who the heirs are. The house is not going to be able to be sold without an estate being opened. It is hard to say how long it will take before a mortgage company will foreclose without any payments being made. I have seen anything from 60 days to a year or more. You should run your specific facts by an attorney in your area to see what the best course of action is given your specific set of facts.
LEGAL DISCLAIMER-An attorney can only give you competent legal advice if he or she knows all the facts and is licensed to practice law in the state specific to your question. The comments above are not intended to be legal advice but general comments based on the limited information provided in the question. I am only licensed to practice in the State of Tennessee.
I agree with Mr. Montgomery. When the only asset is a house, and when that house is underwater, there is not much of a point in opening probate. It can be heartwrenching to walk away from it, but sometimes a long, expensive probate process can be worse.
Other factors to consider are: whether the heirs can and want to continue to pay the monthly mortgage and insurance, whether the property can be sold for a profit rather than foreclosed upon (unlikely based on the facts you present), how long the foreclosure process is in your state. If it's possible the house is worth something you may even want to consider getting an appraiser.
Doing a bit of homework prior to deciding to open probate can save a lot of time and money. Best of luck with these difficult decisions.
The advice in this comment is general advice, and may not be applicable in your situation. I hope you will find this comment informative. Please consider me for your business and estate planning needs. Thank you.
Years licensed, work experience, educationLegal community recognition
Peer endorsements, associations, awardsLegal thought leadership
Publications, speaking engagementsDiscipline