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Financial advisory
RES5Financial Advisory Services✓In premium financing for a Universal Life policy, what typically serves as the collateral, and how much does the financial institution usually lend?
Because most ULs have cash value from Day One (owing to the large upfront payment), this first-day cash value acts as collateral. The financial institution typically finances about 70% to 80% of the first-day cash value.
The collateral is the policy's own first-day cash value (not property or deposits), and lending is ~70-80% of that cash value, not of the premium or sum assured.
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