Loan Refinance for Principal Home Plan Loan

[Dazednconfused]

Participant received a plan loan in November 2007, 15 year payment period for purchase of his home (final payment October 2022. Plan allows for refinancing of loans. He has since refinanced to increase his payments and to shorten length by 5 years already.

Now he would like to lower his payments (of course this would extend the repayment period and perhaps beyond the original final payment date), anything out there that would not permit the 2nd refinancing?

If not, does the refinancing and new payment period have to be completed in a certain length of time (since it was for purchase of a new home)? That is, does the re-fi need to be within the first 15 years it was first made or .....?

Thanks!

[QDROphile]

Although the plan may allow refinancing, a plan cannot loan an amount for a term of greater than 5 year to refinance a home loan. Loans for a term of greater than 5 years are allowed only for the purchase, not a refinancing of a purchase. Looks like the first refinancing was a violation since it was for a term of more than 5 years.

[Dazednconfused]

Although the plan may allow refinancing, a plan cannot loan an amount for a term of greater than 5 year to refinance a home loan. Loans for a term of greater than 5 years are allowed only for the purchase, not a refinancing of a purchase. Looks like the first refinancing was a violation since it was for a term of more than 5 years.

Hi, thanks, he increased his plan loan payments so that shortened the original loan will be paid off earlier than 15 years, he did not refinance his personal home loan.

Thanks again.