When a family member dies, we not only inherit his or her property, but also his or her debts, which is, in addition to the obvious pain of loss, a hard blow to the family members who must take over the deceased person’s obligations. And not only that. In addition, the death of a person forces his family to carry out a multitude of administrative and legal formalities. A real ordeal, coupled with the sadness for that loved one who has left us.
Sometimes it happens that the deceased had a mortgage contracted, what happens in these cases, does the family have to take care of it, what happens if we have inherited a mortgaged property?
Well, let’s try to clarify these doubts. The first thing we have to do is communicate to the bank what has happened, since, as long as the change of property name is not made, the quotas will still be charged to the account holder, in this case, the deceased person.
Each bank has its own policies in cases such as this, but in principle, at the time a person dies leaving a mortgage, relatives must give them the death certificate, the certificate of last wills, the will or declaration of heirs, the deed awarding the inheritance, the certificate of payment of inheritance tax, and if you renounce the inheritance, the public deed of renunciation. The life insurance that we take out with the mortgage does not always cover it in its entirety, so it is necessary to submit this documentation, in addition to the corresponding bank. To the insurance company.
If you inherit a mortgaged property, you have to pay it, unless you renounce the inheritance, something that more and more people do before the impossibility of facing the expenses derived from it. Inheritance is a right, never an obligation, and therefore, we can always renounce it.
The heirs have 3 options
So, if the deceased person had a contracted mortgage, the heirs can do 3 things:
Accept the inheritance, which means taking care of all outstanding debts
Reject it, if it is not possible to meet the expenses
Accept the inheritance for the benefit of inventory. This means that, after payment of the mortgage, the heirs will receive the remaining part of the inheritance.
When there is more than one owner or a guarantor, things get complicated, because now, everything will depend on the conditions they have agreed. If there are 2 owners, the heirs will assume 50% of the inheritance, and the rest will be paid by the second owner or guarantor. And the same happens if there are 3 or more owners. Each one would have to pay the corresponding percentage. If the heirs renounce the inheritance, it will be the owners who must assume all the debts assumed by the contracting of the mortgage.
The guarantees will continue to be so when the holder has died and will continue to be so if the heirs take charge of the mortgage, and until the moment in which it has been liquidated. But if the relatives renounce the inheritance, then it will depend on the conditions that have been signed at the time of contracting the mortgage, which is not always the same.
It can also happen that a property shared with other relatives is inherited, among which there are disagreements, or they are unable to reach an agreement, and therefore, decide to sell the inheritance, either in its entirety.