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My father died without a will and so there's a lengthy legal process for obtaining ownership/title of the house.

In the meantime we have the property rented out and I've been making mortgage payments to the bank.

The question is: will the bank want to issue a new mortgage in my name if I let them know that my father is deceased? How could one get a mortgage on a property that they don't yet own?

I have no problem making the payments, even at the currently-higher interest rates - but I don't have a lump sum of a few hundred thousand dollars to buy the house outright if they attempt to force a sale.

  • Doesn't the bank have to be notified as part of any title transfer? I assume the rent is being paid to the estate, which means the mortgage payments should be coming from the estate as well, rather than your pocket. Consult a lawyer to make sure that if the house does need to be sold, you can be considered a creditor to the estate for any payments you personally have made so that you are in line (after the mortgager) for a share of the sale proceeds. (Disclaimer: I am neither a lawyer nor Canadian.) – chepner Feb 15 at 16:07
  • (Put it this way: continuing the mortgage payments yourself may only be delaying the eventual sale, not preventing it, and you have no guarantee that you can ever recover that money. If the house sells for less than what the bank is owed, you'll get nothing. If the house sells for more, the excess goes to the estate, and your share of the estate may not include any extra mortgage payments you made.) – chepner Feb 15 at 16:10
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I'm sorry for your loss.

In a similar situation, I just kept on paying the mortgage while keeping receipts. It took a few months, but "only" a few months. That was without a will.

You may want to check if there was mortgage insurance. That would pay off the remainder of the mortgage. It still takes a few months, but this may be faster. Unfortunately, I doubt the bank will be willing to give you a mortgage in your current situation, not until you have title on the house. You may be able to get a line of credit, but honestly I don't think that's a good idea. Not least because if there's some legal problem, you are personally stuck with the loan and someone else gets the house.

If it isn't a financial hardship (given the renters) to keep paying and if you have reason to believe this won't drag on for years (which it can, but my guess is that it's unlikely in your case), I suggest you just keep paying the mortgage. I very strongly suggest not taking on a personal loan until you get title to the house. But, you may well want to seek legal advice so as to better understand what other options you may have.

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