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loans from DB plans


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3 replies to this topic

#1 k man

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Posted 19 October 2004 - 02:42 PM

can someone explain how loans in DB plans operate? my main question is how do you account for it if there is no account balance?

Edited by k man, 19 October 2004 - 02:59 PM.


#2 WDIK

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Posted 19 October 2004 - 03:09 PM

The amount of the loan available ties in with the participant's vested present value of accrued benefit. The loan itself is considered an asset of the trust in general rather than being "assigned" to that participant's benefit.
...but then again, What Do I Know?

#3 mbozek

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Posted 21 October 2004 - 11:34 AM

Some fids require that the employee pledge assets to secure the loan in case of a default because plan funding would be affected if the loan cannot be paid as opposed to merely reducing the participant's account.
mjb

#4 buyertoday

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Posted 22 October 2004 - 02:06 PM

In certain circumstances, our DC plan will allow for a rollover of the acct. balance with the loan from another company's DC plan.

Is anyone familiar with allowing a loan rollover from a DB plan into a DC plan?
How does this operate? Our recordkeeper has never experienced this either.

Thanks.