Does a life insurance policy count as an asset for the beneficiary?

Question

I opened up a life insurance policy for my child and i was wondering if i could user that as an asset to get a mortgage? I called the company and they said that it was not a term policy so it build cash over a period of time

Answer 1

Unless the cash surrender value is very high, it is not an asset.

Answer 2

No, you cannot use that as collateral.  If it has a cash value, you can borrow that and use it as part of a down payment, but not as collateral.

Answer 3

Be frankly,It is gonna take a while to find the answer for your question.Try the resource here for reference.http://insurance.free-onlinetip.info/ins...

Answer 4

The cash value portion could be considered an asset, but the death benefit is not.  

Answer 5

It would NOT be an asset to the beneficiary, but the cash value would be an asset to you.

Make sure you have a good policy...

http://www.InsurancePickle.com/life-insu...

Answer 6

The policy is only an asset to the owner of the policy, not the beneficiary.  If you own a 100,000 policy and the cash value is $300 the $300 is the only asset.  The $100,000 isn't an asset until it's paid out, and then it's an asset for the beneficiary.  I'm thinking you are both the owner and the beneficiary of this policy, though.  But if your child owned the policy and you were just the beneficiary the child would have the asset until the policy paid out.  I know it's a bit complicated...

Most residential mortgage companies will not accept life insurance cash value as an asset for mortgage purposes, especially with the market as it is today.  Most policies just don't have enough cash value to make a difference in your total assets.  Besides, it's hard to control what happens to the policy - the owner could cash it in or stop paying the premiums.

I hope you find a source that will work for you!

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