Plan Sponsors FAQ’s

Can plan sponsors limit the amount a participant can borrow?

Yes. Plan sponsors may set whatever loan amount maximum they choose, provided it complies with relevant law (IRC 72(p) limits) and is applied in a non-discriminatory fashion.

How does the MyPlanLoan solution help prevent loan defaults?

Approximately $50 billion* is unnecessarily lost from retirement plans annually by participants who terminate employment and cannot afford to pay off their outstanding loans, usually within 60 to 90 days. First, the MyPlanLoan Customer Service team proactively communicates to participants the need to make timely loan payments to avoid default and the associated taxes and penalties. Additionally, by utilizing MyPlanLoan direct invoicing, plan sponsors may allow repayment after termination. This complements the plan sponsor's outplacement services and allows participants to avoid taxes and penalties because of a forced distribution.