Feb262026
Probate Q&A Series

What happens to the mortgage and property taxes when a spouse dies and I’m still living in the home? – North Carolina

Short Answer

In North Carolina, the mortgage and property taxes do not disappear when a spouse dies. The home may pass automatically to the surviving spouse (often through tenancy by the entirety), but the lender can still enforce the loan terms if payments stop, and the county can still enforce property tax collection. The practical result is that someone must keep paying the mortgage (or work out a solution with the lender) and keep property taxes current to avoid foreclosure or a tax enforcement action.

Understanding the Problem

In North Carolina probate situations, the key question is what happens to ongoing home expenses—especially the mortgage payment and county property taxes—after a spouse dies while the surviving spouse continues living in the home. The answer often turns on how the home is titled (for example, in both spouses’ names with survivorship versus only the deceased spouse’s name) and whether the surviving spouse is also a borrower on the mortgage note. The issue usually comes up quickly because monthly payments and tax bills keep coming even while the estate is being handled.

Apply the Law

North Carolina law separates (1) who owns the home after death from (2) who is responsible for paying debts and charges tied to the home. If spouses owned the home as tenants by the entirety, the surviving spouse generally becomes the sole owner automatically at death by survivorship. Even then, a deed of trust (mortgage lien) and property tax obligations can still affect the property, and missed payments can still lead to foreclosure or other collection steps.

Key Requirements

  • How the deed is titled: Ownership after death depends heavily on whether the home was held with survivorship (commonly tenancy by the entirety for married couples) or in the deceased spouse’s individual name.
  • Who signed the mortgage note: The person(s) who signed the promissory note are personally responsible for the debt; the home itself also remains collateral for the loan through the deed of trust.
  • Keeping taxes current: County property taxes continue to accrue and must be paid to avoid enforcement actions that can ultimately threaten the home.

What the Statutes Say

Analysis

Apply the Rule to the Facts: Here, a spouse has died and the surviving spouse is still living in the home. If the home was titled in both spouses’ names as tenants by the entirety, North Carolina law generally places ownership in the surviving spouse automatically, but the mortgage lien still remains on the property and payments must stay current to avoid foreclosure. Property taxes also continue to come due, and unpaid taxes can create serious title and enforcement problems even while the estate is being sorted out.

Process & Timing

  1. Who acts first: The surviving spouse (and, if an estate is opened, the personal representative). Where: the Clerk of Superior Court in the county where the estate is administered (and the county tax office for property tax billing questions). What: confirm the deed ownership type, confirm who signed the mortgage note, and notify the lender of the death while continuing payments. When: as soon as possible, because the next mortgage due date and the next tax due date arrive on their normal schedule.
  2. Mortgage handling: If the surviving spouse is a co-borrower, the lender typically expects payments to continue as before. If the surviving spouse is not on the note, the lender may still accept payments, but the surviving spouse usually needs to work with the lender to update records and discuss options (assumption, refinance, or other servicing solutions) while avoiding missed payments.
  3. Property tax handling: The county continues to assess and bill property taxes. If the tax bill is escrowed, the mortgage servicer may keep paying it from escrow as long as the mortgage stays current; if not escrowed, the responsible party must pay the county directly. Keeping proof of payment matters for later title work and estate administration.

Exceptions & Pitfalls

  • Title is not survivorship title: If the home was only in the deceased spouse’s name (or did not have survivorship), the home may need to pass through the estate before the surviving spouse has clear authority to sell or refinance, even if the surviving spouse lives there.
  • Surviving spouse paid a debt that was partly or fully the decedent’s obligation: Depending on who was legally responsible for the mortgage debt, the surviving spouse may have a potential claim for contribution or reimbursement from the estate in some situations. These issues are fact-specific and often come up when the surviving spouse uses personal funds to keep the loan current.
  • Life estate elections and tax responsibility: In some estates, a surviving spouse may end up with (or elect) a life estate interest in the home rather than full ownership. A life tenant generally has the duty to pay property taxes, and failing to do so can create disputes and damages claims.
  • Assuming probate is unnecessary: Even when the home passes by survivorship, probate may still be needed for other assets or to address creditor issues. Also, lenders and title companies often require specific documentation before allowing a refinance or sale.
  • Letting insurance lapse: Mortgage documents typically require hazard insurance. After a death, policies and billing can get disrupted; a lapse can create lender-placed insurance and higher costs.

For more on related North Carolina issues, see keeping the house when it was in both names but there is still a mortgage and how to transfer the house into a surviving spouse’s name after death.

Conclusion

In North Carolina, a spouse’s death does not eliminate the mortgage or property taxes on the home. The home may pass to the surviving spouse automatically if it was held with survivorship (often tenancy by the entirety), but the mortgage lien remains and property taxes continue to come due. The most important next step is to confirm how the deed is titled and who signed the mortgage note, then keep the mortgage and property taxes current while any estate paperwork is handled.

Talk to a Probate Attorney

If a spouse has died and the home still has a mortgage and ongoing property taxes, our firm has experienced attorneys who can help explain the options, coordinate with the estate process, and identify timelines that matter. Call us today at 919-341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.

Category: Probate Q&A Series

Author: Pierce Law

Pierce Law Group is a North Carolina law firm focused on probate administration, real estate partition matters, and surplus funds claims across North Carolina. We know these situations often come with stress, family dynamics, and time-sensitive decisions—so we prioritize clear communication, steady guidance, and a practical plan from day one. Our goal is to make a complicated process feel manageable, while protecting what matters most to you.