Hi there everyone,
I’m hoping someone can help me with a query I have on taking loans from your 401k
in our plan you can have 2 loans at any one time and the plan rerefences to 2 standard IRS rules as applicable (up to 50% of vested balance or 50k less the excess between highest o/s loan balances and current o/s loan balance)
I currently have 2 loans and want to pay one of them off and then take out another one, when I check what the estimated amount is I can take as new loan it seems wrong so wanted to check if it’s correct or not.
here are some apt figures
Total vested balance = $78,150
loan 1 current o/s balance = $14,300
loan 2 current o/s balance = $11,700
the highest o/s balance over the past 12months was $32,670
i want to pay back loan 2
the estimated amount is gives me is $17,340 available as a new loan. It give me this amount if I say that I would pay off loan 1 or both loans too. Is that correct?
it seems that it’s just reducing the 50k by the highest loan balance not the difference o/s balance and new current o/s balance once I pay one back.
Any help or guidance would be greatly appreciated, I call the benefits centre who mange our plan and they can’t answer my query they just sound confused.
