Passing wealth from one generation to the next is never just a financial transaction. It is a moment loaded with emotion, legacy, and often, complexity. For high-net-worth (HNW) and ultra-high-net-worth (UHNW) families, the stakes are higher still. Their assets are not simply investments — they are family homes, prime property portfolios, and estates that carry history and meaning.

Yet in 2025, transferring property wealth across generations has become increasingly difficult. Rising property values have inflated inheritance tax (IHT) liabilities. Probate remains slow, tying up assets when liquidity is urgently needed. Younger generations may not have the income to support large mortgages, even when the family wealth exists on paper. Against this backdrop, intergenerational property finance has become essential. It bridges the gap between legacy planning and practical reality, ensuring assets can move smoothly from parents to children without unnecessary loss or disruption.

The Liquidity Problem in Generational Wealth Transfer

The single biggest issue families face when passing property down is liquidity. A London townhouse worth £10 million may represent an extraordinary legacy, but it also carries an IHT liability that can exceed £4 million. HMRC expects that bill to be settled quickly. Families who cannot raise cash in time may be forced to sell property, often under market value.

This is not a theoretical risk. Across the UK, families are struggling with IHT-driven sales. In our article on Inheritance Tax and Mortgages in 2025, we highlighted how property finance can ease these pressures by releasing capital against high-value assets. Without such facilities, even the wealthiest estates may find themselves asset-rich but cash-poor.

For families, the result can be fragmentation. Instead of heirs inheriting the properties intended for them, assets are liquidated simply to cover liabilities. Intergenerational planning that took years to design can unravel in months.

Why Traditional Mortgages Are Rarely the Answer

When the next generation seeks to take over property, the natural question is whether they can mortgage it in their own name. For many heirs, the answer is no. Mortgage affordability tests are based on income, not inherited wealth. A 30-year-old inheriting a £5 million property may lack the salary to support a conventional mortgage, even though the family’s balance sheet is strong.

This mismatch between traditional mortgage criteria and the realities of intergenerational transfer has created a demand for specialist solutions. Private banks, wealth-focused lenders, and bespoke finance arrangements have stepped into this gap. Their appetite is not based solely on salary multiples but on broader wealth profiles, assets under management, and family office structures.

Lending Structures That Enable Smooth Transfers

Several types of property finance have proven valuable in supporting intergenerational transfers:

Bridging Finance During Probate

Executors often need liquidity to cover tax bills or equalise distributions between heirs. Bridging loans provide rapid access to capital, secured against property, buying time for the estate to be settled. In our piece on Probate Finance in 2025, we explained how these facilities prevent fire-sale disposals and preserve estate value.

Private Bank Mortgages

At the HNW and UHNW level, private banks frequently take a more holistic approach. If heirs are set to inherit wealth or already have assets under management with the bank, they may be able to secure large mortgage facilities that reflect future wealth as much as current income. This enables children to retain significant assets without needing to sell.

Refinancing Family Estates

Parents themselves sometimes choose to refinance properties while alive, using released equity to provide gifts or loans to children. This avoids forcing heirs to borrow heavily at the point of transfer and ensures the family controls timing.

Whole of Life Policy Integration

Families who use whole of life cover as part of their IHT planning often combine it with finance. Lending is arranged in the short term to meet tax bills, with the life policy payout ultimately covering repayment. We discussed this approach in detail in our article on Whole of Life Policies and Property Finance.

Case Study: Preserving a Multi-Generational Estate

Consider a family with a £20 million countryside estate held across several generations. The matriarch wishes to pass ownership to her children and grandchildren. On paper, the estate value provides security for any lender. In practice, the IHT liability on death will exceed £7 million, far more than the heirs can raise quickly.

By working with a specialist broker, the family arranges a private bank facility secured against the estate. The loan provides liquidity to cover IHT obligations when they arise. In addition, the parents refinance part of the property portfolio during their lifetime, releasing equity used to help the next generation acquire homes of their own. When the estate is eventually passed down, the family avoids forced sales, and the intergenerational transfer is completed smoothly.

The Emotional Dimension

Intergenerational property finance is not just about numbers. Families often underestimate the emotional strain that comes with trying to preserve legacies under financial pressure. Forced sales do not only reduce wealth; they can also cause rifts between heirs who feel they are losing something that was promised to them. Structured finance provides breathing room. It allows decisions to be made calmly, preserving family relationships as well as financial assets.

The Role of Family Offices and Advisers

For many UHNW families, these transactions are managed by family offices or coordinated with lawyers and accountants. But finance remains the piece of the puzzle that requires a whole-of-market view. Not all lenders understand the nuances of trust ownership, inheritance strategies, or multi-generational transfers. Deals can be derailed by risk-averse underwriters unless the right institution is approached in the right way.

This is where independent brokers with private bank access add value. They know which lenders have appetite for intergenerational structures, how to present cases to credit committees, and how to align lending with broader estate plans.

How Willow Can Help

At Willow Private Finance, we specialise in arranging finance that preserves legacies. For intergenerational transfers, that often means:

• Identifying lenders who will consider wealth holistically, not just income multiples.

• Structuring facilities that align with probate, trust, or whole of life planning.

• Working with family offices, lawyers, and tax advisers to integrate lending seamlessly.

• Protecting families from fire-sale disposals that erode value and disrupt succession.

With more than 20 years of experience in HNW and UHNW property finance, we understand that these are not abstract transactions — they are family legacies. Our role is to provide liquidity, structure, and stability so that wealth can move smoothly from one generation to the next.

📞 Want Help Navigating Today’s Market?

Book a free strategy call with one of our mortgage specialists.

We’ll help you find the smartest way forward—whatever rates do next.