My mother had a mortgage on her house when she passed. Her will stated that everything should be divided between all 6 children. One child is not well-off and we signed an agreement that she could assume mortgage. Is this legal? And if she can't get a mortgage, what happens? Is she automatically the owner of the house and she can sell it to repay mortgage?

She can assume the mortgage if the lender agrees. Or the estate can maintain ownership and she pays the mortgage through the estate.

She will not own the property until the deed is transferred.