Legal Question in Wills and Trusts in California

Not until they both die, and the child probates the estate of the second to die and have the house in their name.

The important thing to understand is that you can't get a loan unless you are the owner of the property, which usually means that after the surviving parent's death, the estate of the survivor is probated, which typically takes from 9-15 months to complete. Only then may the heirs obtain a new loan against the property.

While it's possible for the estate to borrow money against the home, this isn't very likely to be accomplished as the estate isn't likely to have any income, and that means resorting to private lenders (if you can find one) at disadvantageous (to you) interest rates.