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Showing results for tags 'primary residence'.
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Hello, what is the consequence if a plan did not obtain the supporting documentation to prove the loan from the 401k or 403b plan was for the purchase of a primary residence? Is self-correction available? Are there penalties/or filings assessed?
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A plan's loan policy had a limit of 5 years for participant loans. The vendor issued a loan a couple weeks ago for a 15-year primary residence loan. The plan sponsor does not want to adopt a new loan policy that allows for primary residence loans. The loan is not in default, the end of the cure period hasn't passed. One payment just occurred. Has an actual error occurred that would necessitate VCP? Could this be self-corrected by re-amortizing the loan now to not go outside 5 years or by having the participant pay off the loan now and borrow from outside the plan?
