Can a home in probate with a mortgage be sold in Idaho?

Short answer: Yes — but only if the person with legal authority to act for the estate (usually the personal representative/executor) has authority to sell the property, and the mortgage is handled at closing (paid off or assumed). Often the probate court must approve the sale or the will must give the personal representative a power-of-sale. Lenders, creditors, and beneficiaries also affect what steps you must take.

Detailed answer: how selling a mortgaged estate property works in Idaho

Start by remembering two basic rules. First, legal authority matters: only the decedent’s personal representative (sometimes called an executor or administrator) or someone who has a court order can sell property that is part of the probate estate. Second, a mortgage stays attached to the real property until it is paid off, transferred, or the lender agrees to another resolution. That means the buyer, the estate, and the lender all must be part of the plan to sell.

Step 1 — Confirm whether the house is part of probate

Check title and estate paperwork. The house might already pass outside probate if it was owned as joint tenants with right of survivorship, held in a living trust, or had a transfer-on-death beneficiary deed. If the property is a probate asset, the personal representative controls it subject to court rules and creditor claims.

Step 2 — Who can sell the house?

In Idaho, the personal representative appointed by the probate court has the authority to manage and, with the appropriate authority, sell estate assets. If the will explicitly gives the personal representative a power to sell real property, that may be sufficient. If not, the personal representative usually will need to petition the probate court for an order approving the sale. The probate court supervises estate administration to protect creditors and beneficiaries.

Step 3 — What about the mortgage?

• If you sell the house, the mortgage must be resolved at closing. Typical outcomes are: the sale proceeds pay off the mortgage (common at a standard closing); the buyer assumes the loan with the lender’s approval; or the lender agrees to a short sale or deed-in-lieu if sale proceeds are insufficient.
• If the estate cannot pay off the mortgage, the lender can pursue foreclosure unless you reach another agreement (short sale, loan modification, or deed in lieu). The personal representative should communicate with the lender early and get a payoff statement in writing.

Step 4 — Court approval and notice requirements

If the will does not give express power to sell real property, or if the sale is to occur under special conditions (credit sale, sale at private sale rather than public auction), the personal representative commonly must ask the probate court to approve the sale. Court approval usually involves filing a petition and providing notice to beneficiaries and creditors. The court wants to ensure the sale is fair and that proceeds will be used to satisfy debts, expenses, and distribute to heirs.

Step 5 — Who gets paid from sale proceeds?

At closing the usual order is: mortgage lender(s) are paid off so the title transfers free of the mortgage; estate administration costs and funeral expenses are paid; other creditor claims are paid according to Idaho probate priorities; then remaining funds are distributed to beneficiaries under the will or by intestacy law. If sale proceeds don’t cover the mortgage, the estate (or specific beneficiaries if they agree to contribute) must cover the shortfall or negotiate with the lender.

Practical examples (hypotheticals)

Example A — There is a mortgage and probate has opened. You are the appointed personal representative. You list the house, receive an offer, and the title company will obtain a payoff at closing. The sale pays off the mortgage and the remaining funds go to the estate for debts and distribution.

Example B — The house is worth less than the mortgage. As personal representative you negotiate a short sale with the lender and petition the probate court to approve the sale because the proceeds won’t fully satisfy creditors. The lender may accept less than full payoff or pursue deficiency depending on Idaho law and the lender’s policy.

Where Idaho law is relevant

Probate procedures and the authority of personal representatives are governed by Idaho probate statutes (Title 15). You can review Idaho’s probate statutes at the Idaho Legislature website: Idaho Statutes — Title 15 (Probate & Administration). If you will be asking the court to authorize a sale, those court forms and local rules from your county court will show required steps and notice requirements; the Idaho Courts self-help pages also provide guidance: Idaho Courts.

Common issues and how to handle them

• Lender refuses to cooperate: Escalate early. The personal representative should request a written payoff and options (loan assumption, short sale). If the lender refuses reasonable options, consult a probate attorney about court-supervised sale or negotiation strategies.
• No personal representative appointed yet: You cannot sell estate property until you have legal authority. Consider filing to be appointed as personal representative (or asking someone to) so the estate can be managed.
• Beneficiaries disagree about selling: The personal representative may petition the court to approve the sale despite objections if the sale is reasonably necessary to pay debts or is in the estate’s best interest.
• Short sale or deficiency concerns: Ask the lender in writing whether it will accept a short sale and whether it will pursue a deficiency judgment. Idaho law and lender policy affect whether a deficiency is pursued.

Helpful hints — quick checklist before trying to sell

• Confirm ownership and whether the property is a probate asset (check deed and trust documents).
• Obtain an up-to-date mortgage payoff statement from the lender in writing.
• If you are not the personal representative, do not try to sell the property.
• If the will lacks a power to sell, plan to petition the probate court for authority and expect to give notice to beneficiaries and creditors.
• Work with a title company experienced in probate closings — they will handle payoff at closing and ensure clear title to the buyer.
• Keep records of all communications, offers, and receipts — those are needed for the estate accounting.
• Consider hiring a probate attorney early if the mortgage balance exceeds the property value, beneficiaries disagree, or the lender refuses ordinary payoff terms.

Where to get more help

If you need forms or local procedures, check your county’s probate clerk and the Idaho Courts website. For legal advice tailored to your situation, contact a licensed Idaho probate attorney. If funds or the estate size are small, ask about simplified or small-estate procedures that may avoid full administration.

Important disclaimer: This article is educational only and does not constitute legal advice. I am not a lawyer. Laws change and every situation has unique facts. For advice about selling a mortgaged house during probate in Idaho, consult a licensed Idaho attorney who handles probate and real estate.