Introduction
Inheritance advances can be a lifesaver for heirs who need immediate access to their inheritance. In this blog, we’ll break down what inheritance advances are, how they work, and their benefits and potential drawbacks.
What is an Inheritance Advance?
An inheritance advance, also known as an inheritance loan or inheritance cash advance, is a financial service that allows heirs to access a portion of their expected inheritance before the probate process is complete. Unlike a traditional loan, it doesn’t have to be repaid by the heir. Instead, the company providing the advance is reimbursed directly from the estate.
How Does it Work?
The process typically involves a few steps:
- Application: The heir applies for the advance, providing information about the estate and their inheritance.
- Evaluation: The company evaluates the application, assessing the value of the inheritance and the likelihood of probate concluding favorably.
- Offer: If approved, the company makes an offer, usually a percentage of the expected inheritance.
- Agreement: The heir signs an agreement, and the funds are disbursed quickly, often within days.
Benefits of an Inheritance Advance
- Immediate Access to Funds: Heirs can access funds quickly to cover urgent expenses.
- No Repayment: Unlike a loan, the advance doesn’t need to be repaid by the heir.
- Risk-Free for Heirs: If the inheritance is less than expected, the heir isn’t responsible for the shortfall.
Drawbacks to Consider
- Cost: Inheritance advances can be expensive, with the company taking a significant portion of the inheritance.
- Not All Heirs Qualify: Companies typically require a minimum expected inheritance amount.
- Potential for Misunderstanding: Some heirs might not fully understand the terms, leading to dissatisfaction later.
Conclusion
Inheritance advances can provide much-needed financial relief for heirs facing delays in probate. However, it’s crucial to understand the costs and terms before proceeding. Always consider consulting with a financial advisor or attorney to ensure it’s the right choice for your situation.