Jayson Lowe explains that owners of whole life policies with high cash value can borrow against that cash value, sometimes as soon as the policy starts. The insurer provides the loan on demand, you control repayment timing, and the loan is secured by your death benefit rather than how you spend the money.
Can you borrow against your life insurance? So if we're addressing a dividend paying or participating whole life insurance policy, also referred to as high cash value life insurance, the answer is a resounding yes. Now, depending upon the carrier that you purchase the policy through, you can begin accessing capital as early as day one, the day that the policy is in force. And you can utilize the life insurance company's capital without interrupting any of the daily cash value growth inside of your own policy policy. Now, what's interesting, and what most people don't know is that the insurance company has a guaranteed loan provision where you can borrow against your ever increasing cash value on demand, on your terms. Meaning the loan is unstructured when you request it. You receive proceeds the money from the life insurance company, and the repayment schedule is controlled by the policy owner, not the life insurance company. And the reason that that is is because the insurance company itself is guaranteeing the collateral for the loan. The lien for the loan balance is on the death benefit of the insurance contract, not what the policy owner used the money to finance or to purchase. So that puts you in a position of total and absolute control. You can borrow against the cash value of your policy if it's structured properly and if it's with the right carrier. Beginning on day one.
