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If the deed is only in dad's name, then when he passed, it would then be owned by his estate and would have to go through probate. If there was no will, then an Heir would need to file to be appointed administrator of the estate. If there was a will, it would be for an executor. The appointed person would then have the legal right to gather all assets, pay any debts and distribute any surplus to the heirs.
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But until someone is appointed administrator/executor (A/EX), no one would have the legal authority to negotiate with the bank on disposing of the property. The A/EX would then have the authority to list the property with a realtor as well as execute a deed in lieu of foreclosure if a deal can be reached with the bank.
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If the lender forecloses and sells the property, they can then sue any cosigner on the loan for any deficiency as well as come after the estate (if there are any assets). So this would definitely kill the cosigner's credit and subject them to having their assets seized to sell to pay the judgment. At that point, bankruptcy would be the only option to extinguish the liability for the debt.
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So no, going through probate is the only way for someone to get the legal authority to deal with the bank. If someone does it themselves, it would just involve the filing fees to file the probate case, usually $4-500. If they retained an attorney, I would opine it would run in the $2,500-4,000 range depending on the amount of work for the attorney.
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Thanks.

Barrister

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