Using an inheritance advance to fund a property deposit

Property markets don't wait for estates to settle. If you have found a home you want to buy, or you are being outbid because you don't have your deposit ready, the 9 to 12 months of estate administration between now and your inheritance can feel like a very expensive delay. For some beneficiaries, an inheritance advance is a way to close that gap: it unlocks a portion of the entitlement now, funds the deposit, and is repaid from the estate when it settles.

This is one of the more common ways beneficiaries use an advance and it's also the use case where getting the structure right matters most, because the deposit is only one part of the transaction. The mortgage that sits behind it has to work too.

Why timing matters for property buyers

The gap between finding a property and settling on it is usually 6 to 8 weeks which is nowhere near enough time for a typical estate to distribute. Beneficiaries in this situation typically fall into one of a few groups:

• First home buyers whose deposit comes largely or entirely from the expected inheritance
• Existing owners upgrading or downsizing, where the inheritance was meant to bridge the deposit and stamp duty on the new property
• Buyers wanting to purchase without selling their current property first, using the inheritance instead of bridging finance
• Investors wanting to add a property while prices or a specific opportunity are available

In each case, the underlying financial position is the same. The money is coming, the beneficiary is entitled to it, and the estate's timing is the only thing standing between them and the purchase.

How the advance fits into a property purchase

An inheritance advance provides a lump sum now, drawn against your confirmed entitlement from the estate. That lump sum can be used for any purpose including funding a property deposit. Because the advance is repaid from the estate rather than from your income, it doesn't create an ongoing repayment obligation that would reduce your borrowing capacity for the mortgage.

The typical structure looks like:

• Inherita advances a portion of your entitlement — say, 30% to 50% of the confirmed inheritance — to cover the deposit and associated costs (stamp duty, legal, moving).
• Your mortgage broker arranges the balance of the purchase price through a standard home loan, assessed against your income and existing commitments.
• You settle on the property using the deposit from the advance plus the mortgage funds.
• When the estate settles, the advance is repaid directly from your inheritance. You keep whatever's left over.

Working with your mortgage broker

The biggest planning point is the mortgage not the advance. Most beneficiaries think about the deposit gap first, but the mortgage is where structural issues can derail the purchase. Some considerations to work through with your broker:

• How the deposit is characterised. If your broker submits the advance as a personal loan, the mortgage lender will treat it as a debt and reduce your borrowing capacity accordingly. If it's characterised as an advance against a confirmed inheritance entitlement, with documentation from the estate solicitor, some lenders will treat it more favourably.
• Servicing. An inheritance advance has no monthly repayments but the mortgage lender may still want to see how you would service the mortgage if the estate distribution were delayed. Being able to show income covers the mortgage in the interim removes that concern.
• Genuine savings requirements. Some lenders require 5% of the purchase price to be "genuine savings" — money you've held for 3+ months. An inheritance advance won't satisfy that on its own, so if you are relying entirely on the advance for the deposit, choose a lender who accepts equity-substitute structures.
• LMI implications. If the advance takes your deposit to 20% and avoids LMI, the total cost of ownership drops meaningfully. If it takes you from 5% to 12%, the LMI saving may or may not exceed the cost of the advance which is worth modelling with your mortgage broker.

How much can be advanced?

Inherita typically advances up to 50% of your confirmed entitlement, subject to the estate's structure. In practice, most property-deposit cases involve advancing enough for the deposit, stamp duty, and a modest buffer not the maximum available. Advancing more than you need adds cost with no benefit, so we work backward from the deposit target rather than forward from the entitlement.

The confirmed entitlement matters. Where a will names you clearly and the estate is straightforward, we can assess quickly. Where the estate is contested or your share is uncertain, we assess against the minimum you are likely to receive after all reasonable adjustments. That may reduce the amount available.

What if the estate takes longer than expected?

Cost is a function of time. The Inherita advance has a fixed cost at each estimated settlement date, and if the estate takes longer, interest accrues until settlement. Your repayment is always capped at your share of the estate so extra time never means paying out of pocket.

For property purchases specifically, this matters because settlement risk is real. Executors can and do face delays, and beneficiaries planning around a specific date should build in a buffer. See our guide on estate settlement timelines. If you expect distribution in 6 months, plan around 9. If you expect 9, plan around 12.

Frequently asked questions

Buying property before your inheritance settles? Inherita can advance the deposit against your confirmed entitlement — with no monthly repayments and no impact on your borrowing capacity for the mortgage.