ESTATE ADVANCE

Access estate funds now to pay

IHT or other estate liabilities

Access estate funds now to pay IHT or other estate liabilities

Access Estate funds now to pay IHT or other Estate liabilities

If you are an Executor of an estate facing an Inheritance Tax bill (or other Estate liability) without access to the necessary funds then we can help

Many estates can take up to 12 months to administer, yet Inheritance Tax needs to be paid within 6 months from death and probate/confirmation/letters of administration can’t be obtained without paying the tax. Without probate/confirmation you can’t sell assets within the estate to raise the funds to pay the tax.

Whilst it may be possible to agree with HMRC to pay the Inheritance Tax via instalments, this can be complex, you will need to have sufficient funds to pay the first instalment and it may not be the most cost-effective option. This is when we can help.

The Estate Advance enables Executors immediate access to up to 50% of the value of the estate. Not only can the funds be used to pay Inheritance Tax they can also be used to pay other estate expenses including the repair/renovation of property, legal fees etc.

Applications are assessed solely on the value of the estate. No personal guarantees or charges over property are required. If it turns out the value of the estate is less than expected, then as long as you have kept to the terms of the agreement, you will not be required to pay the shortfall should there be one.

The Advance is normally repaid in full when the proceeds from the estate are realised. There are no monthly repayments and no early repayment fees.

Fees

The Arrangement Fee (which is simply added to the loan) is 2% of the loan amount. The interest rate is 2% per month for as long as the Advance is outstanding.

Crucially, we only charge simple interest rather than compound interest. This means you are not paying interest on the interest. In the example below, this would result in a saving of £1,440 compared to all other providers with the same rates that do charge compound interest.

Representative Example

An Advance of £50,000 will incur an Arrangement Fee of 2% (£1,000). Interest is calculated on the advance and the fee. Interest accrues daily, based on an annual rate of 24% (fixed). Assuming the Estate takes 12 months to liquidate, you would owe £12,240 in interest plus £51,000 in capital and fees, resulting in a total balance owed of £63,240 and a representative 26.5% APR.

To apply or for more information contact us on

Process

An Estate Advance can be used to pay IHT, repair/renovate property in the estate, pay legal fees or other estate liabilities.

An Estate Advance can be used to pay IHT, repair/renovate property in the estate, pay legal fees or other estate liabilities.

  • To apply, complete a short online form or call us on 0203 813 6400. We aim to pre-approve eligible applications within 48 hours.
  • Applicant and Administrator receive a document checklist including:

– Copy of Death Certificate
– Copy of Will (if applicable)
– Confirmation of the assets and liabilities within the estate
– Proof of ID, address and bank details

  • Provira’s underwriters assess the application. Successful applications receive a formal email
  • Loan documents are issued and signed (normally electronically). Funds are released.
  • When the estate is settled the loan is repaid to us, normally by the Estate Administrator or the professional firm responsible for the sale of a property within the estate.

FAQs

How is an Estate Inheritance Advance different from a traditional loan?

Traditionally, personal loans require the borrower to sign a personal guarantee or to provide security to the lender over their assets, such as property. In the event that the borrower defaults, the lender can then take possession of personal assets and sell them to recover what they are owed. Estate Advance is different. The product was designed to underwrite Estates, not borrowers, so you won’t be asked for any form of personal security. Our claim is against the assets of the Estate and in the event of those assets selling for less than we are owed, then as long as you’ve kept to the terms of the agreement, that’s our loss. There are no monthly payments and no early repayment fees.

What can I use an Estate Advance for?

The Advance can be used to pay Inheritance Tax or other estate liabilities

What if I don’t have a strong credit history?

That doesn’t matter, because underwriting is focused on the Estate (and its assets/liabilities) rather than your personal credit rating. The application process therefore ensures that there’s a clear link between applicants (i.e. Executors) and the Estate, as well as establishing the estimated value of eligible assets within the Estate, to advance funds against.

Will you decline my application based on my income or job status?

No. The decision will be based on the assessment of the Estate. Therefore, your employment information is not relevant.

What happens if my final Inheritance doesn’t cover the total amount I owe?

That’s OK and as long as you’ve kept to the terms of the agreement it’s not your risk, it’s ours. This is why we ensure we fully understand the Estate as part of our underwriting process. If we get the assessment wrong we bear any associated loss.

How much money will I be advanced?

We will estimate the value of the Estate’s eligible assets less any liabilities owed, such as the Administrator’s fees, mortgages over property within the Estate, etc. This gives the Estate’s estimated net eligible asset value.

Eligible assets are typically (UK domiciled) cash, as well as publicly quoted investments and properties that are to be sold. We may consider other assets by exception. You will then be offered up to 50% of your portion of the Estate’s net eligible assets. You may, of course, take less.

How much does it cost?

The Arrangement Fee (which is simply added to the loan) is 2% of the loan amount. The interest rate is 2% per month for as long as the Advance is outstanding, but we won’t charge you more than 30 months worth of interest.

Do you charge simple interest or compound interest?

Unlike other providers we only charge simple interest, not compound interest. That means you are not paying interest on the interest.

What if there are other beneficiaries?

That’s absolutely fine. Our underwriting is based solely on your share of the Estate and your Advance has no impact on the other beneficiaries. It is also fine for more than one beneficiary of an estate to apply for an Advance.

Do I need the permission of the Beneficiaries?

No – as the Executor/Personal Representative you are entitled to take out an Estate Advance.

What if the deceased did not leave a Will?

That’s OK. The Inheritance Tax will still need to be paid regardless of whether or not there is a valid Will. Thus, you can still apply for an Estate Advance.

Do I need a professional firm to manage the Estate?

We require a professional firm to be responsible for the distribution of the asset(s) that will enable the Advance to be repaid. This would typically be the Estate Administrator or Conveyancing Solicitor

When do I repay the Loan and are there any early repayment fees?

The loan is repaid when the assets from the estate are realised. There are no early repayment fees.

What if I change my mind?

You will have 14 days to withdraw from your Advance from the date you enter into the loan agreement starting with the day after the latest of (a) when the agreement is made, (b) the day you receive a copy of the executed agreement or (c) when you are told the agreement has been executed and is in the same form as the copy agreement you already have. Should you elect to do so, within 30 days after withdrawing you will need to repay the amount of the Advance together with accrued interest, at the interest rate set out in your loan agreement, from the date the Advance was provided until the date of repayment.

Who are Provira?

Provira’s founding team and investors are experienced financial professionals, having successfully launched and invested in many innovative specialty finance businesses. We are passionate about building disruptive businesses that focus on benefiting the consumer. We’ve worked for and with some of the largest and most reputable financial institutions globally.

I still have questions,

what should I do?

That’s OK, we’re here to help however we can.

Email us anytime on [email protected] or call us on weekdays (excluding bank holidays) between 9am to 5pm on +44 (0) 203 813 6400. If for whatever reason we can’t take your call, we will get back to you as soon as possible.