If my mother passed away but left no will and has property valued at $285,450 but with a reverse mortgage on it, how do we determine our inheritance?

UPDATED: Oct 1, 2022

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If my mother passed away but left no will and has property valued at $285,450 but with a reverse mortgage on it, how do we determine our inheritance?

She took out a reverse mortgage for about 40% of the value of the house. We need to know how do the courts consider inheritance in the case of no Will.

Asked on October 31, 2017 under Estate Planning, Colorado


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

If there is no will and no survivings spouse (i.e. your mother was not married when she passed), her children will share in the estate evenly or equally.
The reverse mortgage must be paid off or the home will be foreclosed. It is an estate debt and so should be paid by the estate; if there is not enough in the estate to pay it, people who stand to inherit could contribute money to pay it off, so they get the house. Another option is for the administrator or personal representative of the estate (the person appointed by  court to have authority over the estate, its debts, and its distribution) sell the house, using the proceeds to pay the mortgage and then distributing the remainder to the heirs.
Based on what you write, there is roughly $170k in equity--for that amount, it is well worth your while to retain an attorney (e.g. a probate lawyer) to help you.

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