I would like to know how other practitioners would proceed in the following situation:

A loan policy provides for a minimum loan of $1,000. The vested account balance on the date of a loan request is $2,000, making the loan okay (50% of the balance being $1,000). A day or 2 later when the check for the loan is to be cut, market fluctuation has dropped the balance to $1,900 (Daily world, of course).

Should the loan be given to the participant for $950 (50% of the account balance) since the loan request was available on the request date? Or should the loan be denied until such time as the account balance rises to or over $2,000?

What is your practice in situations like this?

I would vote for the $1,000 loan. Our policy was to grant the loan for the amount that was available on the day that the person requested it. This at times would involve a complicated process to have the operating system grant a $1,000 loan when the vested balance of the participant was under $2,000.

It was also interesting to watch participants, who were on that $1,000 border, try to time the market to get the loan in when their balance exceeded $2,000! What one will do for $$...