Furthermore, they need to be on the lookout for a demand clause that may give to the lender the right to
demand full repayment of the loan at any time for any reason.
When investing in bonds, the goal is to receive competitive interest payments (coupons) as scheduled and to receive
full repayment of your loan at maturity.
The Small Business Administration has also set out a series of tough guidelines for how a life insurance policy should be restructured in order to ensure
full repayment of a loan if the borrower dies.
When you borrow money conventionally you have to: (1) pay back the loan by some definite date; (2) pay the lender interest on the money borrowed over the course of the loan period; and (3) put up adequate collateral
until full repayment of loan has been made.
This is because your money is allocated to loans: our ability to provide access prior to
the full repayment of these loans relies on other lenders purchasing your part of each loan.
The only thing required is
full repayment of the loan plus interest on time.
As a result, a lot of borrowers who were in good standing find themselves with a severely damaged credit or being harassed by collection agency calls demanding
the full repayment of the loan.
The outstanding loan amount will reduce the death benefit dollar for dollar in the event of the death of the policyholder before
the full repayment of the loan.