For the average American, majority of who are in debt, one of foremost question always revolving in their mind is . In case you are a part of that bulk population you can consider annuity loans as a method to . You first need to know about the definition of annuity to utilize annuity loans to pay back your debts. Annuity can be defined as a sum of money that is paid at every given interval that is pre scheduled. It can be described as a form of investment that obtains a regular deposit throughout your working career and also provides regular compensation after you retire. This is where annuity differs from other investment instruments such as IRA.
Usually the best use of annuity loans is for retired people as a source of income. The Federal government has devised such financial vehicle as a support for retired persons the premiums generated from annuity loans can help you in maintain your lifestyle in future after retirement. However, this is not the only use of annuity loans. You can sell your annuity loans in order to get cash to pay your debts that are outstanding or you can also get annuity loans against their premium to get in your hands some instant cash to meet any emergency financial need. There may be plenty of reasons why you would want to sell the premium of your of your annuity investment most common of which is the need for ready cash. In such situations you may want to sacrifice the full profit of your annuity investment and sell the premium of the annuity and get a loan against it.
Since the interest rates on credit financing is relatively low, you can take advantage of this if you can successfully get hold of a lender who is willing to grant you a loan against the annuity premium that you have by using it as a security. However, it is quite a daunting task to find the correct financial institution which is eager to provide you an annuity loan against your current policy in this particular process. If you want to get out of debt by loaning against your annuity policy then you might try to apply for the annuity loan in the financial institution from where you had taken credit and gained debt in the first place. Thus you can use a structured annuity loan as a source of fund for consolidating your debts. This is especially beneficial for you as the interest rate on loan repayment or annuity loans is lower than your current loan interest rate.
Thereby, you can see how annuity loans is an unconventional but useful way to get out of debt and beat the debt collectors.
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September 17 2011 09:19 pm | Uncategorized