Richard CanfieldPodcast Host and IBC Advisor, Ascendant Financial · Authorized Infinite Banking Practitioner | Author of 4 Books

What Banks Don’t Tell You About Loans

18 Mar 2025 · 1 min

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0:37

Short excerpt from a YouTube video by Richard Canfield explaining distinctions between loans, debts, and leverage. The speaker says a loan/debt arises when financing an asset that can decline in value (risk of being "upside down"); contrasts that with leverage (illustrated by writing a check without funds) and notes financing of a participating guaranteed whole life insurance contract falls into the loan space but differs if the underlying asset is guaranteed/appreciating vs volatile.

Chapters

A loan and a debt is when you finance an asset that could go down in value. You could be quote unquote upside down. That's a debt. You cannot pay the red debt because it went down. Leverage is like my check writing example. I'm giving $100 check. I'm writing a check. I don't have the money. There's nothing to give you today. Here's $100 check. When that check is used and that instrument is used, I've got this thousand dollars. If you're financing a participating guaranteed whole life insurance contract, it's in that space of a loan. I understand that, but it's a difference when a guaranteed appreciating asset versus a volatile asset, that's the difference between loan and debt and leverage.