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Barrister
Barrister, Attorney
Category: Legal
Satisfied Customers: 38183
Experience:  16 yrs practice, Civil, Criminal, Domestic, Realtor, Landlord 26 yrs
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can I barrow money using a paid up life insurace policy?

Customer Question

can I barrow money using a paid up life insurace policy?
Submitted: 4 years ago.
Category: Legal
Expert:  Barrister replied 4 years ago.

Hello,

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Thank you for using JA. Yes, there is no legal prohibition that would prevent you from borrowing money against the value of the policy. The only problem would be in finding a lender that would allow you to use the policy as collateral for a loan.

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Although it might not be a preferable option, if the policy has a cash value, you could always consider cashing it in or selling the policy to a buyer. There are companies who invest in paid up insurance policies and buy them for a discounted value based on the owner's life expectancy. This can allow the owner to essentially cash out the policy and receive a portion of the face value of the policy to use currently and then the buyer would be paid upon the seller's death.

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Thanks.

Barrister

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Please don't forget to rate my service "OK" or higher. It is only then that I receive credit for my work.

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If you need further help, just reply to me via the “REPLY” or “CONTINUE CONVERSATION” button and I will be happy to continue.

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I am trying to help you understand and resolve your situation but I don't make the laws, so the outcome may not be what you had hoped for.

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Please be patient as I am typically working with several customers at any given time.

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I cannot enter into an attorney client relationship, this is a public forum, and all posts are available for public viewing. There is no duty of confidentiality that attaches to any posts. The information provided is not a substitute for a local attorney’s legal advice.