Can a participating whole life policy be the key to fast, flexible funds when traditional credit falls short?
This short guide explains how a Canadian policyholder can use the cash surrender value of a participating whole life policy as collateral with recognised lenders, such as Equitable Bank, Manulife Bank of Canada, Scotia Wealth, Gracie Point and BMO Wealth Management.
Readers will see how lenders set terms — from 50% to 100% of CSV, variable-rate term options, interest-only or blended payments, and choices on amortization — all subject to lender discretion and credit review.
An assigned policy protects the lender’s position, and any outstanding balance plus interest is deducted from the death benefit on claim, while policy values continue to grow on a tax-advantaged basis inside the contract.
This service-focused overview also touches on related home financing options through broker channels and practical steps to contact a lending specialist, so Canadians can match short-term needs with longer-term planning.
What an Equitable loan means in Canada today
Many Canadian policyholders now tap the cash value inside participating whole life contracts to meet short-term financing needs.
Approved carriers include Equitable Bank, Manulife Bank of Canada, Scotia Wealth, Gracie Point and BMO Wealth Management. These lenders accept assignment of the policy so owners can access tax-free proceeds while the contract stays active.
Borrowing limits commonly range from about 50% up to 100% of the cash surrender value. Typical products include a variable-rate term loan or a personal line of credit to suit different credit profiles and cash needs.
Payment choices often include interest-only or a blended principal-and-interest schedule. The amortization period and rate are set by the adjudicating institution, and all lending remains at the lender’s discretion.
Because the policy is collateral, any outstanding balance plus accrued interest reduces the death benefit at claim. Applicants in Quebec should be ready to present the original policy document if requested.
Comparing these options with home-secured loans helps borrowers pick the structure that best fits their current objectives.
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Equitable loan: a practical, step-by-step path to funding
A simple workflow helps policy owners confirm cash value, engage a lender and complete funding. Start by requesting an updated inforce illustration to verify the policy’s cash surrender value and sign any required disclaimer before assignment.
Next, contact a lender — examples include Equitable Bank, Manulife Bank of Canada, Scotia Wealth, Gracie Point or BMO Wealth Management — to be connected with a lending specialist. The specialist will outline structures, expected payments and how amortization affects total cost.
During adjudication, the lender typically asks for a Personal Financial Statement, an electronic copy or printout of the life policy (original required in Quebec), the updated inforce illustration and a letter of direction for disbursement.
Approval steps include credit review, conditional clearances and status updates. Once approved, clients complete assignment and documentation and funds are disbursed per the letter of direction. Good communication between advisor and lender keeps timelines on track.
Plan how to service the facility — interest-only or blended payments — based on cash flow and short-term needs. Keeping records organised speeds underwriting and reduces back-and-forth with the customer and service teams.
Rates, terms, and lending options tailored to your life
Borrowing against a policy or tapping home equity requires a clear view of rates, terms and trade-offs.
Lenders set borrowing parameters for CSV-backed facilities, usually allowing 50%–100% of the cash surrender value. Options commonly include a variable-rate term or a revolving personal line of credit.
Payments can be interest-only to maximise short-term flexibility or blended to reduce principal over time. Choosing between them should reflect current cash flow, retirement or investment plans and tolerance for payment variability.
For Canadians focused on property, the bank works through licensed brokers to deliver fixed or adjustable home mortgages, HELOCs with lower rates and higher limits, and reverse mortgages for retirees who want tax-free funds with no monthly payments.
That broker-only service helps match unique borrower profiles—self-employed, newcomers, foreign income earners or those with limited credit—to tailored lending solutions.
Remember to assess how an assigned policy affects beneficiaries: any outstanding balance plus accrued interest will reduce the death benefit and should factor into estate and investment planning.
Ready to move forward with your loan today
Start by requesting an updated inforce illustration from Equitable Life. Call Customer Service at 1.800.668.4095 or email customerservice@equitable.ca to confirm your CSV and sign any required disclaimers.
Contact a Canadian lending partner—Equitable Bank (wealthsolutions@eqbank.ca; lines-of-credit/csv page), Manulife Bank Specialized Lending, Scotia Wealth (pbil@scotiawealth.com), Gracie Point (mpedrozo@graciepoint.com or gpfc@graciepoint.com), or BMO Wealth Management—to be matched with a lending specialist.
Prepare a Personal Financial Statement, an electronic copy or printout of your policy (original required in Quebec), and a letter of direction. Ask the specialist to review loan structures and how they fit your home planning and timelines.
With documents ready and contacts in place, proceed to application and coordinate closing so funds arrive when needed.
