How Do I Apply for a Loan?

If you have unexpected expenses arise and need to access money in your account, you can apply for a loan from your Plan account. The loan process is very similar to that of your bank or credit union. The HELPLINE can talk to you about the details and how to apply. For more information, please read the Plan’s Loan Program Brochure. (PDF)

How much can I qualify for?

You can borrow up to 50 percent of your vested account balance, with a minimum loan of $1,000 up to a maximum of $50,000. To find out how much you may qualify for, contact us.

How soon do I have to pay it back?

The maximum term for a general purpose loan is five years from the date you receive the loan amount. The term for a loan to purchase a primary residence is 15 years. Loan repayments consist of principal and interest, and you’ll have to make them on a monthly basis. You can only have one outstanding loan at any time. You’ll have to pay off an old loan before taking a new one. If you default on a loan, you can’t qualify for a new loan until the balance of the defaulted loan is repaid, including any interest and fees.

What are the pros and cons?

There are both advantages and disadvantages to taking a loan against your account balance. Weigh these points carefully before making your decision.

• No credit check
• Loans aren’t taxed unless you default on the loan
• Competitive interest rates that are paid back to your Plan account instead of to a conventional lender
• Loan repayments are invested in your plan account funding selections
• Reasonable repayment terms

Disadvantages

• Repayments are made with after-tax dollars
• Loans must be repaid with interest
• A defaulted loan is considered a distribution, and is subject to tax reporting and income taxes
• You may lose the benefits of compounding interest over time
• Could affect your ability to qualify for loans outside the Plan and other retirement plans maintained by your employer

Get the help you need

Contact us if you have questions about the loan program.

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