When employed with my previous employer I took a 401k loan(2015 nov) . Then I quit the employer and joined my current employer in Jan 2018 . Then I setup a auto-debit with my fund manager (Fidelity) , for monthly deductions from my bank to pay off the loan.
When checking my bank account this Dec 2019, I find that my account has not been debited from January 2019 and doing the research I find that Fidelity had sold it to transAmerica in Jan 2019.
I got a postal mail about the transfer from my old employer but nothing about the loans, which made me assume that the loans were taken care of.
When I called transAmerica, they say they had defaulted my loan and sent the note to IRS, because they did not receive payment.
They said they sent me a postal mail notifying me of the initial transfer and the default, which I did not receive. They emailed me a copy and I see the postal address is wrong in their mail.
They do have my correct postal address in their records. But the address in the mail was wrong.So I did not receive it.
The person handling is not very knowledgeable and everytime after being on the call for about an hour or 2, she says she will check with someone else.
I do see some contradictions in what she says:
1. She says once transferred transamerica does not allow monthly payment of loans and one time payment of remaining amount should have been made. But the default letter says the monthly amount was not payed.
2. She says transfer notice and default notice was sent to my house , but after I requested her to email me the sent default postal mail, I see it has the wrong address
3. First she said nothing can be done as they have notified IRS. But now she said their research team is researching.
What are my available options. I did not intend to default and I'm also ready to pay the total amount now to avoid taxes and penalty on remaining amt.
Remaining amount is abt 13000.
