Guest Amanda Davis Posted January 28, 2003 Posted January 28, 2003 Our plan has a rule that states that monthly loan repayments cannot exceed 20% of gross monthly earnings. This is above and beyond the rules regarding maximum loan amounts (i.e. $50K or 50%). We're looking at amending our loan regs and I just wanted to make sure that before we got rid of the 20% rule that I'm not violating any regs. Any input?
four01kman Posted January 28, 2003 Posted January 28, 2003 The 20% rule might have caused you problems if there was discrimination in favor of HCE. That is, an HCE would be able to get a "larger" loan than a non-HCE because of the repayment restrictions. Removing the limitation does not run afoul of any rules I'm aware of. In fact, I would recommend not having any such limitation. Jim Geld
2muchstress Posted January 28, 2003 Posted January 28, 2003 Since participant loans are not a protected benefit, I don't see how the elimination of a term of a loan would violate any regs. I too would recommend getting rid of it.
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now