I am looking to consolidate debt without refinancing? Can I borow against my term life ins. policy?

Question

I am looking to consolidate debt without refinancing? Can I borow against my term life ins. policy?

Answer 1

No, term life policies hold no cash value.

Answer 2

Nope, only against a whole-life policy.

Answer 3

Term life has no cash value. Therefore there is nothing to borrow.

Answer 4

Yes if your policy allows it

Doubt TZ has been in insurance for 35 years

Looked it up..While it builds no cash value  It can give you money anytime in your life if it is needed..

Answer 5

This policy will only be of help if you are dead.

Answer 6

Term life insurance builds up no cash value as does whole life insurance. Thus it is not an asset with value that can be borrowed against.

Answer 7

No.  Term insurance policlies are called "pure" insurance, that is, insurance without the rip-off provisions found in whole life policies.  A term insurance policy is insurance only; whole life includes an overcharge which builds into "cash value".  You can "borrow" this cash value and be charged interest, but the real hoot is you are in effect paying the insurance company extra in order to borrow your own money back with interest.

Term insurance has none of this nonsense.  You might as well ask "Can I borrow against my automobile insurance policy?"  It is the same thing.  I am afraid the insurance companies have you befuddled, but fortunately, you do have term insurance, which is the right kind to have.

If you want to build cash value, open a savings account.  That way, if you want to use some of it later, you won't have to pay to use it.

Answer 8

No, you can't borrow against a term policy becuase there is nothing to borrow against (no cash value, etc).  Think of it like renting a house...you can't borrow against a rented house becuase there no real asset there.

Have you considered just creating an action plan to pay out your debts?  Sometimes a little planning can make a huge difference!