WL LOANS

[Lloyds of Lubbock]

Using your example.
A client wants a 100k and capitalize the interest.
So he gets a loan of 105k assuming 5% loan rate.
He receives a 100%
He pays back the loan of 105k and his policy no longer has a loan.
Can he use that 105K ?
Yes.
Remember he only received a100K so that cost was 5%
You paid a 105k to get a 100.
That 5k went to the insurance company.
I am not sure how a HELOC entered in this.

 

[SamIam]

The interest get back to the insurance company, you're borrowing from their general account fund. By repaying a higher interest rate, all you're doing is recapitalizing the policy back at a faster rate, which is good. Or if you have room at in the policy you're buying PUA, but you don't have to wait to take out a loan to do that.

 

[Allen Trent]

The interest get back to the insurance company, you're borrowing from their general account fund. By repaying a higher interest rate, all you're doing is recapitalizing the policy back at a faster rate, which is good. Or if you have room at in the policy you're buying PUA, but you don't have to wait to take out a loan to do that.

For the most part, whether I take a loan from my life insurance company or I take the loan from the bank & the bank puts themselves on my policy, both are collecting the loan balance from me before they release the lien against my policy.

The money never left the policy in the first place in either example because either the bank or the insurance carrier acting as the lender gave me their money not mine.

The interest charged by the bank or the insurance company is kept by them & they merely release the collateral lien on the policy when I make full payment or die.

I still dont see how paying a higher interest rate impacts my policy performance that wasnt impacted by the loan when none of my money left my policy.

If I borrow money for car, it doenst impact the value of my car. but if I pay 10% instead of paying 3%, I will have much larger net investment in that car if I paid 10% instead of 3%.

Again, Life loans can be great, I just am not seeing how we can say the interest paid makes it back into my policy when my cash value is the same, maybe dividends same, whether I took the loan or not

 

[Lloyds of Lubbock]

All the research you have done says interest goes to the carrier.
I have an email from the head of product development from Guardian that interest goes to the carrier.
It is what it is.
From what I understand about the Nash book and I read it a long time ago.
if you went to buy a car and it had an 8% loan and your insurance policy had a 6% rate borrow it from your insurance policy.
Pay the loan back as if it was an 8% loan and you will increasing the values of the policy.
This only works if you have a PUA rider.
If someone on this board is a proponent of that selling system or a similar one, maybe they can give you a better explanation.

 

[SamIam]

For the most part, whether I take a loan from my life insurance company or I take the loan from the bank & the bank puts themselves on my policy, both are collecting the loan balance from me before they release the lien against my policy.

The money never left the policy in the first place in either example because either the bank or the insurance carrier acting as the lender gave me their money not mine.

The interest charged by the bank or the insurance company is kept by them & they merely release the collateral lien on the policy when I make full payment or die.

I still dont see how paying a higher interest rate impacts my policy performance that wasnt impacted by the loan when none of my money left my policy.

If I borrow money for car, it doenst impact the value of my car. but if I pay 10% instead of paying 3%, I will have much larger net investment in that car if I paid 10% instead of 3%.

Again, Life loans can be great, I just am not seeing how we can say the interest paid makes it back into my policy when my cash value is the same, maybe dividends same, whether I took the loan or not

You're not seeing it because it doesn't exist. Policy loans are great for several reasons, but the paying higher rate talk is a sales pitch that people who are selling it might not even understand.