Detailed Answer
When a decedent’s estate includes real property held as tenants in common with an ex-spouse, the personal representative must first satisfy all valid liens, including any outstanding mortgage. Under N.C.G.S. 28A-13-1, the clerk may authorize sale of estate property to pay funeral expenses, administration costs, taxes, and debts. The representative sells the property, applies the sale proceeds to clear the mortgage lien, and then distributes what remains according to each owner’s share.
Because the mortgage is a lien on the property itself, an ex-spouse co-tenant who never contributed mortgage payments cannot reduce the estate’s distribution in probate. North Carolina law does not allow a non-paying co-tenant to offset their share of net proceeds in the probate process. Instead, that co-tenant may pursue a separate civil action after probate under Chapter 46, Partition of Property. N.C.G.S. 46-23 permits a co-tenant to seek reimbursement for necessary expenses—such as mortgage payments—they paid on behalf of the property. Such a claim runs parallel to probate and must be filed in superior court.
In summary, the estate uses sale proceeds to satisfy the mortgage, then divides the remaining balance between the decedent’s heirs and the co-tenant according to ownership percentages. Any dispute over past mortgage contributions falls to partition or reimbursement claims outside the probate estate.
Key Statutes and Concepts
- Payment of Liabilities in Probate: N.C.G.S. 28A-13-1
- Personal Representative’s Power to Sell Estate Property: N.C.G.S. 28A-17-1
- Partition and Expense Reimbursement: N.C.G.S. 46-23
Key Takeaways
- The personal representative pays off the mortgage lien from sale proceeds before distribution.
- Net proceeds flow to owners by their tenancy-in-common percentages.
- Missed mortgage payments by a co-tenant do not reduce their share in probate.
- Co-tenants who paid mortgage obligations may file for reimbursement under N.C.G.S. 46-23 in superior court.
Handling estate property held as tenants in common can raise complex questions about lien payoffs and share allocations. Pierce Law Group’s attorneys guide families through mortgage satisfaction, property sales, and asset distribution in probate. We also advise co-tenants on civil claims for reimbursement after probate concludes.
For personalized guidance, email intake@piercelaw.com or call (919) 341-7055 today.
