[WSBAPT] Advance on Inheritance

[Mark Vohr]

Brent –

          This comes up for us, even recently.  Basically, your client will have to sign a form that promises payment to the company when the inheritance funds are received – before giving anything to the beneficiary.  The real risk (and you will want to verify this) is on the beneficiary who will be paying exorbitant interest on the unpaid amount until paid.  Generally, the interest is only moderately exorbitant if paid with, say, a year or so.  After a year it will go way up.  So – the beneficiary taking a huge risk if they want the money in the early stages of the probate and the inheritance is based on the unknown timing of the sale of a house.  The loan would be generally much less than the anticipated inheritance -allowing for the huge interest that will be charged.  It is similar to Wentworth buying out structured payments.

          The other thing to be wary of is getting sued by the beneficiary if they feel your client did not move fast enough to sell the asset, resulting in that huge interest expense due to the passage of time.   Good practice tip might be to have the beneficiary sign a release that releases your client from any liability for the timing of the sale and the payoff of the advanced inheritance.  The other thing to watch for is who is liable if the loan exceeds the distribution.   In sum, make sure none of this can blow back on your client.

Let me know if you have other questions, or we can get on the phone.

Regards,

Mark

Mark C. Vohr, J.D. CPGC
Ohana Fiduciary Corporation
A Washington Trust Company
155 NE 100th St., Suite 209
Seattle, WA  98125
Telephone:  (206) 782-1189

From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Brent Williams-Ruth
Sent: Tuesday, August 19, 2025 9:33 AM
To: WSBA Probate & Trust Listserv <WSBAPT at lists.wsbarppt.com>
Subject: [WSBAPT] Advance on Inheritance

Greetings List Members -

This morning I received a called from a California company that apparently is going to give a loan to one of my Estate client's beneficiary who needs the money.

Here is the issue - the estate is mostly (90% of total value) about the proceeds from the real estate.

Does anyone have experience with this that could help me see the hidden pitfalls. My initial sense is that if he wants to sell his inheritance right and we don't even have a verified inventory yet (given that we don't know how much the house will sell for) - that is on him, correct?

Appreciate any guidance you can provide!


Brent Williams-Ruth (pronouns: he/him)
Attorney-At-Law

Law Offices of Brent Williams-Ruth, a division of BWR Consulting, PLLC

Physical Address: 500 S 336th Street, Suite 214; Federal Way, WA 98003

Mailing Address: PO BOX 3319; Federal Way, WA 98063

Office/Scheduling Phone: (253) 285-7751

For All Meetings & Scheduling: info at williams-ruthlaw.com<mailto:info at williams-ruthlaw.com>

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