What You Need to Know About Inheritance LoansNovember 10, 2021 12:00 pm
If you are getting an inheritance, you may think the process is fast. However, it can actually take a while for an estate to work its way through probate court. This can create challenges for people who are trying to pay for funerals or who counted on the deceased for living expenses during their lifetime.
For small, uncomplicated estates, you may be able to speed up the process by bypassing probate. This involves getting all heirs to agree to skip the probate process. However, for many people skipping probate is not an option. What do you do to get money in the meantime?
One option is to get an inheritance loan. Just like the name suggests, an inheritance loan is a loan that uses the future inheritance as capital. These loans are designed to help heirs or dependents bridge the gap between death and settling of the estate.
There are two basic formats for inheritance lending. There are inheritance loans. These are loans that rely on inheritance as the security for the loan. The lender may be able to place a lien on an inheritance if you fail to repay the loan. However, you are responsible for repayment.
Advance inheritance funding is not a loan. Instead, it is a cash advance from your part of an inheritance during the estate process. The money you get is based on your portion of an inheritance.
People have a number of different reasons to borrow money against their inheritance. Most of them are based on the probate process. Probate can be complicated. It may require an executor selling or otherwise liquidating assets. The executor has to pay creditors, which can take an extended period of time. This is especially true if the deceased had an illness before dying, because it can take months to even determine what medical debts the deceased incurred.
In addition, probate can be a contentious process. Heirs or potential heirs can contest the will. Creditors and administrators can fight over which bills are legitimate. Any type of dispute can make the probate process take years. This can take years.
In fact, inheritance cash advances can be a great idea in contentious estates. The lender assesses the value of the estate, your portion of the estate, and the likelihood of success of any challenges. They them make the advance based on the information that they have. If the estate runs out of funds or if litigation goes against you, the lender is the one who loses the money.
Categorised in: Educate Yourself about Inheritance and Probate Advances
This post was written by Inheritance Loans USA