If a parent or someone you loved recently passed away, you may have discovered that you are an heir to their estate. Even if you are the rightful heir, don’t expect to get the inheritance right away. The estate may be required by state law to undergo the probate process before the assets can be distributed, which can take months or even longer. In the meantime, you can gain access to your share of the estate with an inheritance funding company.
What is Inheritance Funding?
Inheritance funding is money provided to you by a lender dependent on your part of the estate. It’s similar to a loan against the estate in the fact that you’re receiving funds that aren’t your own. However, it’s also different because you don’t need to pay the money back because you sell an inheritance rather than borrowing money on it.
An inheritance funding company, also known as a probate loan company or estate loan company, will provide funds to you during the inheritance process until your estate is dispersed. They will put in a claim on the assets and receive your portion of the estate up to the amount that was loaned to you. For example, your part may be $200,000. The lender gave you $50,000 upfront. When the estate is settled, the inheritance funding company will be paid the $50,000 plus any fees, and you will receive what’s left.
You aren’t obligated to pay interest on the amount funded, and there are no monthly payments for the amount you receive even if there is a delay on settling the estate. You carry no risk and no obligation because the lender deals directly with the estate with loans for probate.
Getting approved for loans while waiting for an inheritance doesn’t depend on your employment history, credit rating or other factors about you. The lender looks at your part of the estate and determines if it’s a safe risk to lend money to you based on whether you would receive your full inheritance. For this reason, it’s easy to get approved and have access to the funds in less than a week after you apply.
Can I Get a Loan on My Inheritance?
Requirements for the probate timeline are set by state law. In some cases, it can take at minimum four to six months to settle the estate. However, it usually takes much longer with the average time for completing probate to be around eight months to a year. If there are complications, such as someone contesting the will, it can go much longer.
During this time, you may need money to get by or to maintain the assets of the estate. You may wonder if you can borrow money against the estate in the form of loans for heirs. Getting traditional lenders like banks to lend money on an inheritance is difficult. They know that things can go wrong and probate can be delayed. Private lenders will often lend money against an estate because they are willing to take a higher risk.
A common scenario where you might need a loan is if there is a house included as part of the estate. Perhaps you need money to renovate the house to sell or maybe you want to buy another heir out and keep the house. You would need a loan to pay the other heir if you don’t have funds on hand. While most mortgage companies won’t touch a house in an estate, private lenders will often approve a loan of this kind. Once probate is closed, you can get a loan through a traditional lender with a cash out refinance on property you have inherited now that you have the title to the property in your name.
While getting a loan on your inheritance isn’t impossible, it is often difficult to find a willing lender. Inheritance funding companies are different than lenders because they allow you to assign a portion of the estate to them rather than providing a loan.
What is the Difference in an Inheritance Loan and Inheritance Advance?
The very nature of a loan is the obligation of the borrower to pay off the debt. For an inheritance loan, the heir would be obligated to make the payments until the balance is paid off whether they ever receive the money from the estate or not.
With an inheritance advance, the heir assumes no risk. All the risk is placed on the lender once they have been assigned a portion of the estate. If the distribution is delayed or no funds are available, the lender is the one that is impacted. They have no recourse to go back to the heir and require them to pay. An inheritance advance protects the heir from unplanned circumstances. It is important to understand that some companies use the terms inheritance advance and loan interchangeably, so it can be difficult to know how you are obligated. Understand the terms before you agree to anything and sign any documents.
Can You Use Inheritance as Collateral?
If you decide to get an estate loan, you will use your inheritance as collateral. With an estate loan, you’ll make monthly payments and be charged interest on the amount you borrowed. You’re also responsible if something happens to your inheritance. If you miss one or more of the payments, the lender can take your collateral.
With an inheritance advance, there is no need for collateral because the money to repay the advance comes directly from the inheritance. The important thing to note is that the inheritance advance company gets their portion before you get yours. If the amount you receive from the estate is reduced, you get the lesser amount.
Technically, you don’t own your inheritance because it’s not in your name. For this reason, most banks and traditional finance companies won’t allow you to use your inheritance as collateral. You can’t borrow against something that doesn’t belong to you. Private lenders, also referred to as hard money lenders, will often allow you to use your share of the estate as collateral by assigning it to them. However, they cannot collect if you don’t receive the money, which is why they carry more risk and charge higher interest rates.
Can I Get a Loan Against My Trust Fund?
If you go to a bank, mortgage lender or other traditional financial institution, you probably won’t be able to borrow money on an inheritance. However, if it’s set up as a trust, you may have more options.
Whether you can borrow against your trust fund will depend on how it was set up. The grantor has a lot of room on what they will and won’t allow. Some trusts allow you to get a loan against the assets while others won’t. There may be a limit on how much you can borrow as well.
Another limitation is what you can use the money for. You may be able to find a lender allowing you to borrow funds to improve or maintain an asset in the trust. For example, you may be able to get financing to improve a home which is part of the trust assets. In other cases, you may only be able to borrow against the trust for educational expenses or medical issues. Sometimes, you can borrow from the actual trust rather than using it as collateral in a loan with another institution.
It can get tricky when you’re trying to borrow money or get an inheritance loan. An inheritance advance is the most popular and often the easiest way to get money from your inheritance quickly. It allows you to gain access to those funds in less than a week with no obligation for repayment in the future once you assign that portion of your inheritance to the lender.
ProbateAdvance.com offers inheritance cash advances to help you get by while the estate is being settled in probate. You can apply online or by phone to find out if you’re approved. There’s no obligation and you will receive a free quote. You simply need to provide proof that you are an inheritor to an estate to learn if you are eligible and for how much. Even if you’re approved, you aren’t obligated to accept. An advance is a no-risk way to get a portion of your inheritance now instead of waiting for months or years when probate is closed.
With an inheritance advance, you can do whatever you want with the money with no restrictions. You aren’t responsible for repaying the money even if the estate takes longer to settle or less money is available for distribution. When deciding on whether to choose an inheritance loan or advance, know the differences and the level of risk you assume before you make a decision.
How to Find the Best Inheritance Funding Company
When you search for an inheritance funding company, you’ll find a lot of options. You want to know you are choosing the best business to get approved for an advance on what you will inherit. You can look up the business with the Better Business Bureau and see what kind of rating they have. The Better Business Bureau will also show if there are any complaints and how the company responded. You want to learn how to avoid inheritance scams and protect your money.
Consider how easy it is to access the business. Do they provide a phone number for you to contact them? How is their level of customer service? While the Better Business Bureau is a good place to start, you’ll want to do further research to learn more about an inheritance cash advance business.
Find out how you can apply with the best inheritance advance company. Discover if there is an online form or if you can apply over the phone. Each inheritance funding company will have its own system, and the one you choose should fit with your needs. You can contact them by email or phone to get any questions answered. You don’t want to move forward until you feel comfortable with the company you select. This is information you may not find with the Better Business Bureau, but you can learn the answers to these questions by checking out the website and other online reviews.
With inheritance cash advances, you may not need to worry about your credit score. The business will look at your part of the estate and determine if you qualify. Employment, income and credit score have little to no impact on the decision. One of the benefits of choosing a business that provides inheritance advances is you can get the application approved fast. Lenders can take several days or longer to provide an approval or rejection, but the business that provides inheritance cash advances will get an answer to you within a few days.
The business will review the form and verify that you have an inheritance. If it meets the requirements, you can have your account funded in just a couple of days after approval. Make sure you ask about any hidden fees before you sign any documents. The cash advance business will usually charge a fee for lending the money, which will be paid from the estate once it is settled. However, you don’t want to be caught by surprise with any hidden fees.
The business should treat you as a valued customer and answer any questions you may have. They should provide a free quote based on the information you provide. You are still not under any obligation after receiving the quote. You can review the terms after being presented with an offer and determine if it matches the quote and if you want to move forward. Once you sign the contract and receive the money, you have no more obligation. The inheritance advance business will contact the estate directly for payment.
You can receive money even if you live in a different state from where the decedent lived. For instance, you may live in San Francisco and the estate may be in Seattle. You can find an inheritance advance business either in San Francisco or Seattle to provide the funds you need.
Expect to pay a decent rate to get your money fast. The advance business is taking on all the risk if something happens in the probate process. At the same time, they are providing a valuable service to you as their customer. If you are concerned about the quality of customer service with the business, you can review testimonies and comments on the Better Business Bureau website.
ProbateAdvance.com provides funding fast for heirs who want their part of the estate right away rather than waiting for months or years. Fill out our form or call us on the phone to learn more about how we can help make the probate process easier for you. We provide exceptional customer service with fast approval and funding. You can check our reputation with the Better Business Bureau and learn more about how we can help you get the cash you need quickly. Contact us online or by phone to apply or to get your questions answered.