Actual PAID Claim - Premium Total $35K Benefit $100,839.53
my mother wants to cash in her life insurance, she has approx 9,000, is it better to cash out or take out a loan? 
Generally it's better to take a loan. That way you still have the policy in force. You don't have to pay back a loan. The company might bill you for the interest though. Does she need the whole 9K now or would it be better to borrow say $1k/year?
if she takes a loan does she need to pay it back, if she takes cash does she have to pay taxes?
Depends on how much she has paid into the policy. Anything less than $9K - there would be tax on the difference. That's why a loan might be better. What's her tax bracket? $1k/year would be lower taxes than 9K at one time.
her income is approx (social security only) $7,644/yr, which ss is not suppose be taxable.
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