Loans Answers

How much can I borrow from my 401(k)?

Assuming your plan allows loans - not all do - the IRS limits the amount you can borrow to 50% of your vested account balance or $50,000, which ever is less. Most plans do not allow loans smaller than $1,000. You typically have 5 years to pay the loan back out of payroll deductions - up to 30 if its for a home. You can pay off the loan early.

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What happens to my outstanding loan if I quit or lose my job?

Generally, you will have to pay it back within 90 days of termination. If you don't, the loan will be deemed a distribution, which will be subject to income taxes and a 10% penalty if you're less than 59 ½.

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Can I get more than one loan from my 401(k)?

Yes, if your plan allows it. The total amount you can borrow is, however, limited by the IRS to the lesser of 50% of your vested account balance or $50,000.

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How do I take out a loan?

If we handle your plan, you can initiate the process via our website or voice response system, or you can call us. You don't need to contact your employer.

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