What is an Inheritance Loan and How Can I Use It?
When a person passes away, their estate goes into probate court. It is here that the person’s last will and testament and estates are administered before being distributed accordingly. Estates in probate sometimes take a while to be settled. Unfortunately, there are cases where survivors are too eager to claim their inheritance. Whatever their reasons may be, these survivors will run into heavy estate taxes.
The truth of the matter is people don’t really have to go through all that trouble. There’s a simple solution that’s widely available: inheritance loans.
What is an inheritance loan?
Even though it’s called as such, an inheritance loan isn’t really a loan. A loan is something you are personally responsible for paying back. A loan’s payment plan may be discussed with your creditor. An inheritance loan is more like a cash advance, but you won’t have to pay anything back. This is because you are advancing what you could get out of your inheritance once it comes out of probate. It’s simple, really. If you are eligible, you can advance a certain amount, but once you deplete your estate, that’s it.
Does the inheritance get paid back?
Yes, but not by the person who acquires the loan. Those who are unaware about the concept are fearful at first. They worry that there might be interests or other fees involved. Remember that the inheritance advance is paid back by the estate. If the estate takes a couple of years in probate court, then that is the amount of time your lender will have to wait to get paid back.
What are the eligibility requirements?
Requirements may vary according to lender, but there are a couple requirements applicable in all cases. For starters, there has to be an estate. Second, you have to be heir to or beneficiary of the said estate. The last and most important requirement is that the estate must be in probate.
Once you are deemed eligible, your lender might conduct a simple background check. Although it doesn’t apply to all cases, some lenders will look into your credit history. Don’t worry if your credit history is bad as this will have little to no effect with your case. The lenders will also require that you provide supporting documents. These documents should prove that you are beneficiary to the estate. Lenders also usually meet with the attorney in charge of the estate. This is done to properly assess all values and so that the proper documents are filed in court.
How much can be advanced and how long will it take?
It really depends on how much the estate is worth. In most cases, lenders loan between 30% and 50%. As for amounts, most lenders set their minimum at $10,000. The entire process, including the assessment of values and filing of documents, usually take 5-7 business days.
Isabella Manzanares is a financial consultant who has given clients advice on inheritance advance. For more details on how these can help you, please read up inheritance loan.
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