Guest Colorado Posted December 24, 2003 Posted December 24, 2003 When a particpant's benefit distribution is being offset by his/her outstanding loan balance (there has been no default or deemed distribution), must you include the interest since the last payment to the offset amount?
FundeK Posted January 2, 2004 Posted January 2, 2004 I would say no. If the loan is being offset, not deemed, I would not accrue interest.
Alf Posted January 5, 2004 Posted January 5, 2004 Offset is just paying the loan off early. It is the last bite at the apple, so all accrued interest, fees, and expenses have to be included.
FundeK Posted January 5, 2004 Posted January 5, 2004 If an active participant decided to pay off their loan early, you would have them send a check for the current loan balance, right? There would be no accrued interest charged. Same thing with an offset. Participant is mearly paying off a loan balance. I have never seen any addtional fees or expenses charged. Why type of fees or expenses would there be? (I am assuming here that the payments were current.) I have never seen early payoff fees, is that possible?
Guest debic123 Posted January 5, 2004 Posted January 5, 2004 When we calculate a payoff of a loan, whether by the participant's choice or our's to offset, we calculate interest from that last payment date to the pay off date. We do not add anything else to the payoff amount.
FundeK Posted January 5, 2004 Posted January 5, 2004 What do you consider the "payoff" date? The day the participant calls to request the balance? What if it then takes him a month to send the check in? Also, can the participant call an automated voice response system, and if so, does it know to calculate the accrued interest? Sorry, just a few questions to clarify how this would work. Thanks
Guest debic123 Posted January 5, 2004 Posted January 5, 2004 We calculate the payoff as of a certain date if the participant calls and supply them with the per diem interest. If he calls on the 10th and wants too payoff as of the 25th, then we use that date. All of our notes are due and payable upon termination. The employer is to notify us upon termination and we offset the loan as soon as we know they are terminated. We use the date of offset for the interest accrual. Participants do not have the ability to obtain this information other than to call us personally.
FundeK Posted February 23, 2004 Posted February 23, 2004 Can anyone else let me know how you handle loan offsets? Do you accrue interest from the last payment date to the date of the offset?
Blinky the 3-eyed Fish Posted February 23, 2004 Posted February 23, 2004 You accrue interest from the last loan payment to the next, don't you? Why would this be different? "What's in the big salad?" "Big lettuce, big carrots, tomatoes like volleyballs."
FundeK Posted February 23, 2004 Posted February 23, 2004 What would be the consequence if you did not accrue the interest prior to offset?
Mike Preston Posted February 23, 2004 Posted February 23, 2004 What would be the consequence if you didn't offset the loan?
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