Heir Hunters: How to protect your inheritance
Being contacted about an inheritance you didn’t know about can feel unexpected, even exciting. After all, don’t we all dream about having a rich long-lost uncle or aunt we had no idea about, leaving us a substantial inheritance?
But what if that contact comes from an “Heir Hunter”? It’s important to pause and understand what is being asked of you before you sign anything. In this blog, we explain what Heir Hunters do, how they charge, and what steps you can take to protect your share of the inheritance.
What is an Heir Hunter?
An Heir Hunter is a company or individual who identifies potential beneficiaries of an estate, often where someone has died without a Will. They may contact you directly to let you know that you could be entitled to inherit, but they will usually ask you to sign an agreement before sharing full details. This agreement often gives them the right to charge a percentage of your inheritance.
In recent years, heir hunting has become much more prevalent, with some Heir Hunters focusing on the commercial, money-making opportunity, rather than locating rightful heirs because it is the right thing to do.
How do Heir Hunters operate?
It is important to be aware of how Heir Hunters operate in case you are approached by one. These are the following stages in which they are known to operate:
Heir Hunters will search for estates where someone has died intestate, as the estate will legally pass under the rules of intestacy. Typically, Heir Hunters will use the government’s ‘unclaimed estates list’, which is updated every working day.
Heir Hunters will try to locate the next of kin of the unclaimed estate. They will do this by reconstructing a family tree.
Once they have identified a potential beneficiary or multiple beneficiaries, they will get in contact and try to convince them to appoint them, usually in return for a percentage of that beneficiary’s share of the estate.
How do Heir Hunters charge?
Many Heir Hunters work on a contingency fee basis. On average, they charge 20 percent of an individual’s inheritance. However, we’ve even heard of some cases where it has been as high as 40 percent.
What that means for you:
You will be asked to sign a contract directly with them
Their fee is taken as a percentage of your inheritance
The percentage can vary and may be significant
Whilst this model can appear convenient, it’s important to understand that fees aren’t always proportionate to the work involved.
For example, on a £100,000 estate, the Heir Hunter would take £20,000 (20% cut) and a whopping £40,000 if their percentage cut is 40%. On an estate of that value, the fees are not proportionate to the work involved. However, on a low-value estate, it might be fair to charge 20 percent. However, we believe that the cost should always be calculated based on the work involved, not on the value of an estate.
In addition, Heir Hunters looking for unclaimed estates for commercial opportunities may withhold crucial details. This means that you might sign an agreement before you know the family relation, estate value, and how much of it you are handing over.
Seven ways to avoid unfair commission fees
Most people will be sceptical if they are contacted by an unknown company claiming that they could be a beneficiary to a member of a family they didn’t even know existed before the call. So we understand that it can be tough to tell whether an Heir Hunter is legitimate and if they are going to treat you fairly.
However, we believe that any person due to inherit should be entitled to receive their rightful inheritance. So here is a list on how to handle Heir Hunters and avoid getting caught out by potentially unfair commission fees.
1. Ask plenty of questions
There are some critical questions you should ask an Heir Hunter to make an informed decision. These are the questions we recommend asking:
Who am I inheriting from?
How am I related to them?
What is the value of the estate?
How many heirs are entitled to a share of the estate?
Who is legally responsible for distributing the estate to all heirs?
Is there a cooling-off period should I change my mind after signing?
2. Contact the Government Legal Department
As the Heir Hunter most likely discovered your relative’s estate on the Government’s Legal Department website, we would advise you to contact them directly to find out whether they are still handling the estate. If they are, you can recover the estate yourself, or if they are no longer dealing with it, they will be able to put you in contact with the current Administrator of the estate.
3. Communicate with your family
In many scenarios, communication is key, and when it comes to Heir Hunters, this certainly applies.
As the Heir Hunter researches the family tree, they may discover more members of your family. If this may be the case, we would recommend working with your family to decide what course of action would be best.
4. Seek independent legal advice
You are entitled to seek legal advice elsewhere. In fact, we highly recommend getting impartial advice before signing any paperwork from an Heir Hunter. There are many companies that will offer free advice to ensure that you are getting a fair deal.
5. Take time to carefully consider your decision
Heir Hunters are often known to use high-pressure sales tactics to get people to sign paperwork before they have had time to research or really consider the implications.
Your inheritance is not going anywhere, so don’t feel pressured into making a quick decision.
Take all the time you need to make a carefully informed decision.
The Government Legal Department will allow claims to a deceased’s estate for up to 30 years.
Once the estate has been claimed, you are legally entitled to your share of the estate, regardless of whether you signed a commission agreement. Also, the person dealing with the estate has to make sure you receive it.
6. Remember that you don’t have to appoint an Heir Hunter
Although an Heir Hunter may have made you aware of your inheritance, you are by no means obliged to appoint them.
It is very important to remember that it is your inheritance and your right to receive that inheritance, whether Heir Hunters are involved or not. You can carry out the research yourself, or you can appoint a genealogist to carry out the work on your behalf.
7. Ensure you understand the cost involved
Many people who are contacted by Heir Hunters do not understand the cost until it is too late.
If a percentage fee is involved, ensure you know how much that equates to. A 10 percent fee may not seem like much, but it could end up being thousands of pounds.
There’s a selection of companies that are looking for the commercial opportunity. But there are plenty of people and companies out there who can help you receive your rightful inheritance, and they will charge a fixed fee or agree on a fee up front for the work involved. This is a much fairer approach as the cost is relative to the work involved, which remains the same regardless of the value of the estate.
Case study: Mrs M's story
In this case study video, we tell Mrs M's story and how she was contacted by an Heir Hunter firm. They displayed a very questionable behaviour in trying to locate her inheritance. Watch the video below:
If you are contacted about a potential inheritance, it is important to stay informed and take your time.
Understanding how Heir Hunters operate and knowing that alternative approaches exist can help you make confident decisions and protect what you are entitled to receive.