I have a universal life policy with cash value and I am considering taking out a loan against it. However, I can't find much good information about pro/cons online.

Anyone know anything about this?

Make sure you have a plan to pay it back. There can be consequences to your beneficiaries if you die without paying it all back. Remember too, you need to pay interest on your policy loan. Even though it's "your money", not paying your policy loan will result in having less coverage than you think because your cash value is shrinking if you're not paying back at least the policy loan interest.

If your policy lapses as a result of a loan with no repayments, the IRS may classify it as a withdrawal rather than a loan and you or your heirs may have a tax liability.

In all matters involving taxes, please consult a tax advisor. This does not consitute tax advice.

If this is an amount you feel reasonably confident paying back in three years, or at least the interest portion over the three year period, then go for it.

I would also recommend contacting the customer service department of your insurance policy and ask them to send you an illustration of how your policy would perform under plan assumptions if you were to make *no* payments for three years. Make sure there is no lapse and that your death benefit would not be materially impacted.

Also objects in the rear view mirror may be larger than they appear.