Q: I’m the primary beneficiary and executor of a living trust, I was left a house with a mortgage that I am not

A: As long as you keep making the payments on time the lender cannot foreclose or call the loan due. You also are not obligated to assume the loan. This is federal law that applies if you are a family member of the deceased. If you were not related to the deceased then you might consider selling the house in order to pay off the loan and collect the equity.

A: More information is needed to properly answer your question. One thing to note is that all debts and taxes must be paid before real estate may be distributed to the beneficiary (assuming the real estate was solely in the deceased person’s name.) So, if someone passed away and left only $10,000 in cash and a home, but owed $25,000 in taxes, the trust might be able to obtain a loan to pay off the taxes or perhaps the home must be sold to pay it off. Since each situation involves different amounts of assets and debts, it would be best to speak with an estate planning lawyer to see if there is a way to keep the real estate in your specific situation. Best wishes!

A: I understand you're in a challenging situation with this inherited property. This is a complex matter that impacts many families, and I want to help you understand your options.

There are several potential paths forward, even if traditional mortgage qualification isn't possible. You might explore assumption of the existing mortgage - some lenders allow beneficiaries to take over the original loan terms. Another option is seeking private financing or working with non-traditional lenders who focus on inheritance situations. You could also investigate whether selling a portion of the property's equity to an investor while maintaining partial ownership would work for your circumstances.

Before making any decisions, I recommend consulting with both the current mortgage holder and a probate attorney who can review the specific terms of the trust and mortgage. They can help determine if the lender might offer special arrangements for inherited properties or if there are other legal options available under California law. While selling the house might end up being necessary, taking these steps first will ensure you've explored every possibility for keeping the property.

Remember, many people face similar situations with inherited properties, and there are often solutions that aren't immediately obvious.