Below are the most commonly asked questions about a Living Benefit Loan and the Life Credit Company.
If you have a question that was not answered below, please visit the Life Credit Company’s Contact Page.
How does the Living Benefit Loan program work?
Your life insurance policy is used to secure the Living Benefit Loan with no additional collateral. A certain percentage of your death benefit (usually up to 50%) is loaned to you, and you do not have to pay for your life’s insurance policy premiums after getting the loan.
The loan is paid from your life insurance death benefit. Since you’re accessing only a portion of your death benefit, the difference between the loan and the benefit will be given to your beneficiaries. When applying for a Living Benefit Loan you credit score is irrelevant and not used as a benchmark to determine your eligibility.
Will I continue paying for my life’s insurance program after the loan has been disbursed?
Life Credit Company takes over the payment of all your future life insurance premiums.
Can I use my Term or Group Policies to secure the loan?
Yes. You can always get in touch with Life Credit Company in case you want to use your Term or Group Life Insurance policy to secure the loan. In fact, you can as well use your Universal Life, FEGLI, or Variable policy to secure the loan.
How is my eligibility determined?
Your life insurance policy has to have a minimum of $75,000 death benefit for you to qualify for the loan.
Will I be required to provide any information?
Yes. Life Credit Company will ask for a copy of your medical records as well as your most recent life insurance policy before the loan is approved. This will be done during the initial application stage. You may choose to submit the documents through an email, fax or mail depending on which method is more convenient for you.
Which factors determine the amount of loan I can get?
The size of your loan is primarily determined by three factors namely:
- The worth of your policy
- Your current health status
- The policy’s premiums
What is the loan’s interest rate? Will I be charged any additional fees?
While the interest rate a Living Benefit Loan may vary from one state to the other, it is often 17.9%. The loan will carry a one-time Origination Fee of 3% that is charged on your policy death benefit. In other words, you will not pay any fees from your pocket.
Can the loan’s liability be passed onto my family?
Absolutely not. Your loan is secured using your life insurance policy; hence the liability cannot be passed to any other person.
Are the proceeds from my loan taxable?
No. You do not have to pay taxes on the proceeds from your loan. Note that Life Credit Company offers neither tax nor legal advice. Thus, you should seek the opinion of a professional opinion in case you want to verify this point.
How do I apply for a Living Benefit Loan?
To apply for the Living Benefit Loan, call Life Credit Company on 1-888-274-1777 and a profession counselor will be on hand to guide you on how to apply.