Inheritance Advance

An inheritance advance is a type of borrowing that allows beneficiaries of estates  to immediately access a portion of their future inheritance whilst they are waiting for probate to be granted and assets sold/liquidated.  The loan is repaid in full (capital, fees and interest) when the funds are available. Thus, there are no monthly repayments and no early repayment fees. 

Inheritance advances can be used for any purpose, it is the borrower’s money, the lender is simply providing them with immediate access. .

At Proper Finance, we have partnered with Provira, experts in probate lending, in order to provide you with the most competitive rates in inheritance advance.

What is an Inheritance Advance?

The term ‘inheritance advance’ means the act of a company advancing money to heirs who are looking to get a portion of their inheritance sooner than they would receive it from an estate. The probate process can be incredibly lengthy, so inheritance advances can be particularly useful for individuals who may need access to their expected inheritance quickly.

An Inheritance Advance is issued on the basis of the value of an individual’s future inheritance. That the cost of the loan (i.e. the fees and interest) are paid from the borrower’s inheritance and the Advance has no impact on any other beneficiaries.

There are no monthly payments and no early repayment fees. The loan is simply repaid in full when the assets in the estate are sold / liquidated and prior to the remainder being distributed to the borrower.

Provided there is no breach of the loan agreement, if it turns out the future inheritance is insufficient to repay the full amount, the borrower will not be required to pay the shortfall,

Representative Example

An advance of £50,000 will incur an Arrangement Fee of 2% (£1,000). Interest is calculated on the advance and the fee. Interest accrues daily, based on an annual rate of 24% (fixed). Assuming the Estate takes 12 months to liquidate, you would owe £12,2440 in interest plus £51,000 in capital and fees, resulting in a total balance owed of £63,240 and a representative 26.5 APR.

What is the Purpose of an Inheritance Advance?

An inheritance advance is designed to help individuals who are waiting for the distribution of an inheritance to get access to some of the funds early. It can be obtained pre and post the grant of probate and can be used for any purpose.

Inheritance advances are unsecured, meaning that collateral is typically not required. The amount that is given out by a lender is based on the value of the expected inheritance. The lender will assess the value of the inheritance and, after receiving supporting documentation (such as a will or probate documents), provide a loan. 

How is an Inheritance Advance Different From a Personal Loan?

In the case of personal loans, the borrower is typically required to sign a personal guarantee or to provide security to a lender over their assets. If the lender is unable to repay the loan, the lender is able to take possession of those assets and sell them in order to recover what is owed.

Inheritance advances are different. They are designed to underwrite Estates rather than borrowers. So the borrower is not required to provide a form of security. Provided there has been no breach of the loan agreement, if the assets sell for less than they are owed, the loss falls on the inheritance advance company rather than the borrower.

What Can An Inheritance Advance Be Used For?

Waiting for an inheritance can be a long, drawn-out process. It takes on average a year to gain access to funds from an Estate. This may be too long to wait for an individual with pressing financial concerns. An inheritance advance gives an individual the option to receive some of their inheritance early, with the funds used to help with a variety of things, such as:

• Clearing debts
• Paying off a mortgage
• Auto repairs or a new car
• Putting down a deposit on a new home
• Home improvement projects
• Covering medical or veterinary costs

What is the Eligibility Criteria For An Inheritance Advance?

The eligibility criteria for an inheritance advance in the UK varies between lenders. Generally, you will likely need to meet the following requirements:

Be a UK Resident – You must be a UK resident with a UK bank account

Be over 18 – You have to be 18 or over to apply for an inheritance advance

Be a beneficiary – You must be named as a beneficiary in the will of the deceased or via the Rules of Intestacy. 

There must be a professional firm dealing with the sale and distribution of the assets on which the lender is basing their underwriting. This would typically be the firm dealing with the full estate administration or the conveyancing solicitor dealing with the sale of a property in the estate.

Agree to the terms of the loan. Finally, you will need to agree to the loan terms of the lender. These terms may include interest rate and fees. The loan will then be repaid from the proceeds of the inheritance when the assets in the estate are sold / liquidated and funds are available.

Can I Apply for an Inheritance Advance Even With Bad Credit ?

Yes. The advance that you apply for is secured against the money that you are due to receive from the estate. Your credit rating is not related to your ability to receive some of your inheritance early.

This also goes for employment information. Your employment information is not relevant since the loan decision will be based entirely on the assessment of the Estate.

Advantages of an Inheritance Advance

There are several advantages to taking out an inheritance advance with our partners, Provira. These include:

Loans can be obtained pre and post grant of probate.. The probate process can be lengthy. An inheritance loan can effectively bridge the gap between when you need the funds and when the probate process is settled.

You can get access to funds immediately. An inheritance advance provides quick access to cash.

Provided there is no breach of the loan agreement, if it turns out your future inheritance is insufficient to repay the loan in full, you will not be required to make up the shortfall.

Why Choose Proper Finance for Inheritance Advance Loans?

At Proper Finance, we are proud to partner with Provira in order to provide the safest and most secure inheritance advances available. Provira is fully regulated and authorised by the Financial Conduct Authority with a management team that has over 100 years of experience in financial services, credit management and risk. They are currently rated ‘Excellent’ on the independent review site Trustpilot.

How to Apply for an Inheritance Advance

The process of application is simple. You begin by filling out an online form, or speaking to a team member at Provira. They will then help you to request and review the estate information. You will then be given the details of the advance before it is provided. After this, the advance is provided and the  loan repaid when funds are available.

Frequently Asked Questions about an Inheritance Advance

How Much Cash Can I Get?

The amount of cash that you can get with an inheritance advance will depend on several factors, the primary one being the value of your future inheritance.. The minimum that can be advanced to you is £20,000. The maximum will be up to 50% of your future inheritance.

How Much Do You Charge?

The arrangement fee is typically 2% of the value of the loan and the interest rate 2% per month.

What if My Inheritance is Reduced?

Provided there is no breach of the loan agreement, If your inheritance is reduced for any reason, e.g. another beneficiary coming to light, you will not be impacted. Once you have received the advance, any subsequent changes to the inheritance are at the risk of the lender.

How Quickly Will I Receive the Money?

Funding is typically available within a few days.