Policy Loans

Borrowing money can be expensive. However, if you have a Wesleyan With Profits policy, you could qualify for a Policy Loan from Wesleyan Bank.

 

It’s a quick and easy way to borrow money. The loan will be secured against the surrender value of your policy - which means you will benefit from some of the value of your investment right away. Furthermore, your Policy Loan is a sensible alternative to surrendering your With Profits policy.

You can borrow up to 90% of the value of your policy. Please note that we cannot loan against a policy that is assigned to any party outside the Wesleyan Group.

 

Competitive interest rates

Interest is charged at 3.5% APR above Lloyds TSB base rate, subject to a minimum rate of 8% APR. The interest is all you pay; there are no arrangement fees and no hidden administration charges.

Flexibility

Your Policy Loan is more flexible than a conventional repayment loan. You can choose how and when you repay. You can also decide whether you wish to repay the loan (and interest) during the lifetime of the underlying policy.

Policy remains in force

While the policy is used for security of the loan your investment continues and still attracts any bonuses that may apply.

Use the money for any purpose

You are free to use your Policy Loan for any purpose - a new car, home improvements or holiday, for instance. Your may also want to use your Policy Loan to combine some of your existing debts into one manageable monthly payment.

Repayments

You don't have to make a regular monthly payment. However, if you decide to do this you can pay by direct debit or cheque. Remember that the smaller the amount you pay, the longer it will take to repay the loan.

You can make occasional payments of ad-hoc amounts. To do this simply send us a cheque or payment. We will credit your account upon receipt and confirm your outstanding amount.

You may choose to leave the loan outstanding together with compounded interest until maturity of the policy. The final loan balance and interest owing will be repaid out of the maturity proceeds.

Wesleyan Assurance Society will remit a payment for any remaining maturity proceeds. Please note there is no guarantee that the value of your policy will be enough to repay the loan and any compound interest in full.

If you choose not to repay the interest during the term of the loan, we may ask for repayment if the loan equals or exceeds the surrender value of the policy, at any time.

Consumer Credit Act

Please note that Wesleyan Bank Ltd requires the original policy document as security for these types of loans. Full details of this scheme and a written quotation are available on application.

Loans are regulated by the Consumer Credit Act, 1974. If you apply for a loan we may make credit reference, identity and other enquiries following our normal practice when we consider your application.

What we do and how both we, credit reference and fraud prevention agencies will use your information is detailed in the leaflet called: Guide to the use of your personal information by Wesleyan Bank and Credit Reference Agencies and Fraud Prevention Agencies.

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