A loan is made by the Credit Union to the Executive, which is used to buy a life insurance policy. Some common highlights of this plan are:
- A Legal Document is prepared that outlines all of the details agreed upon between the Board and the Executive.
- The Credit Union earns a return based on the Applicable Federal Rate (AFR).
- Benefits are withdrawn by the Executive Tax-Free during retirement.
- The Loan is repaid with Interest at the Executive’s Death.
