probate loans
Understanding Early Access to Your Inheritance
In the UK, probate usually takes 9-12 months to complete. Learn about inheritance advances that may provide earlier access to funds while the legal processes continue.
When someone passes away, their beneficiaries often know they will inherit money but cannot legally access it until probate is complete. This waiting period can create financial challenges or cause people to miss time-sensitive opportunities.
Inheritance loans offer one potential solution, allowing beneficiaries to receive a portion of their inheritance early.
How Inheritance Loans Work During Probate
Inheritance loans, also known as inheritance advances, provide beneficiaries with early access to a portion of their expected inheritance. These arrangements are quite different from traditional personal loans because they’re based on your legal entitlement to inherit rather than your current financial situation.
The key distinction is that inheritance advances are typically secured against your future inheritance proceeds, not against your personal assets or income. This means that factors like your employment status, credit history, or current financial circumstances usually don’t affect eligibility in the same way they would for conventional borrowing.
Important note: The inheritance itself remains part of the deceased’s estate and cannot be used as security until probate is complete and legal ownership transfers. Instead, these arrangements rely on your documented entitlement to receive the inheritance once probate concludes.
Most inheritance advances provide access to between 25% and 50% of your expected inheritance, depending on various factors including the estate’s complexity, the types of assets involved, and the certainty of the inheritance amount.
Repayment is made automatically from your inheritance when probate completes and the estate is distributed. You don’t make monthly payments – the loan amount plus interest is simply deducted from your inheritance when you receive it.
Why does probate stop me getting my inheritance?
When someone dies, all their assets are legally “frozen” until a court grants probate.
This happens because:
Banks and institutions won’t release funds without a Grant of Probate – the legal document proving you have authority to access the deceased’s accounts and assets.
Debts must be paid first – The estate might owe money to creditors, HMRC for taxes, and various bills. These must be settled before anything can be distributed to beneficiaries.
Assets need proper valuation – Properties, investments, and business interests require professional valuations for tax purposes and fair distribution.
The will must be validated – Courts need to confirm the will is genuine, properly executed, and represents the deceased’s final wishes.
This legal process typically takes 9-12 months to complete properly. Until then, your inheritance exists but remains inaccessible – which is exactly the problem inheritance loans solve by providing early access to funds you’re legally entitled to receive.
Get Expert Guidance on Your Probate Loan Options
Don’t spend hours researching lenders or risk choosing an unsuitable option. Our specialists can help you to find the right solution for your circumstances.
Call or email us today.
Common Situations That Lead People to Seek Early Access
People consider inheritance advances for various reasons, though the decision requires careful thought about costs and necessity. Understanding when these arrangements might be appropriate can help in making informed choices.
Time-sensitive opportunities
Time-sensitive opportunities sometimes arise during the probate period. For example, someone might find a property they want to purchase but cannot wait 12 months for probate to complete. Similarly, investment opportunities or business ventures may have timing requirements that don’t align with probate schedules.
Debt management
Debt management is another common consideration. If someone has high-interest debt while their inheritance sits unavailable, they might calculate that an inheritance advance, despite its costs, could be financially beneficial compared to continued high interest charges.
Personal financial pressure
Personal financial pressure during probate can be significant, particularly if the beneficiary was financially dependent on the deceased or has experienced job loss or income reduction. In such cases, early access to inheritance might provide necessary financial stability.
Family and life events
Family and life events don’t pause for probate completion. Educational expenses, medical costs, or family emergencies may require immediate funding when inheritance money exists but isn’t accessible through normal legal processes.
Steps in Arranging an Inheritance Advance
Initial assessment involves providing details about the estate, your inheritance entitlement, and your funding requirements. Lenders can usually provide preliminary guidance within 24 hours.
Documentation review is essential, as lenders need to verify your legal entitlement to the inheritance. This involves examining the will, confirming the estate’s value, and understanding any factors that might affect the inheritance amount or timing.
Application and approval processes are pretty quick. Most specialised lenders can provide decisions within 7 days.
Fund transfer typically occurs within 7-14 days of approval. The money is provided directly to you for use as needed.
How Beneficiaries Typically Use Early Access to Inheritance
Understanding how others have used inheritance advances can help in evaluating whether this approach might be suitable for your situation.
Property transactions
Property transactions represent one of the most common uses. House prices can change significantly during typical probate periods, and property opportunities may not be available indefinitely. Some beneficiaries use inheritance advances to fund deposits or complete purchases when market timing or specific properties make immediate action beneficial.
Debt consolidation
Debt consolidation can make financial sense when someone has high-interest debt while their inheritance remains inaccessible. For example, credit card debt at 20-25% annual interest rates may be more expensive than an inheritance advance, making early access financially logical despite the borrowing costs.
Investment opportunities
Investment opportunities sometimes arise that beneficiaries want to pursue immediately rather than waiting for probate completion. Whether this makes sense depends on the specific opportunity and the costs of early access to funds.
Business and career development
Business and career development might benefit from immediate funding. This could include starting a business, funding professional development, or investing in equipment or property for business purposes.
Family support and life events
Family support and life events often cannot be postponed for probate completion. University fees, medical expenses, family emergencies, or other significant life events may justify early access to inheritance funds.
The key consideration in all cases is whether the benefits of immediate access outweigh the costs of borrowing.
How do the loans work?
Probate loans are secured against your inheritance entitlement rather than your personal assets or income. Lenders assess the estate value and your legal right to inherit, then provide a portion of that inheritance early – typically 25-50% of your expected amount.
How are the loans repaid?
Repayment comes automatically from your inheritance when probate completes and the estate is distributed. You don’t make monthly payments – the loan amount plus interest is simply deducted from your inheritance when you receive it.
Am I charged interest?
Yes, interest is charged monthly (typically 2% per month) from when you receive the funds until the loan is repaid from your inheritance. All interest costs are paid from the inheritance proceeds, not from your personal funds.
How long does it take?
Most applications can be assessed within 24-48 hours, with funds typically available within 7-14 days for straightforward cases. Complex estates or unusual circumstances may take 2-3 weeks, but this is still much faster than waiting 9-12 months for probate to complete.
What can the loan money be used for?
For inheritance loans (beneficiaries): The money can be used for any personal purpose – house deposits, debt consolidation, investments, business opportunities, family emergencies, or any other financial need. There are no restrictions on how you spend your inheritance advance.
For executor loans: The funds should be used for legitimate estate expenses such as inheritance tax payments, legal and professional fees, property maintenance and insurance, or other costs related to administering the estate properly.
Get Expert Guidance on Your Probate Loan Options
Don’t spend hours researching lenders or risk choosing an unsuitable option. Our specialists can help you to find the right solution for your circumstances.
Call or email us today.
