Extra Payments on Plan Loans

[ERISA13]

We have a plan where once a participant maxed out their deferrals last year they increased their loan repayments. My question is how should the extra loan repayment be applied to the outstanding loan balance. My thought is that the extra should all be applied to principal but the plan provider applied the overage to the next payment so it went to the next payment's interest and principal. The way they did it they show the loan payments are caught up thru late 2012. I have checked the plan document (document, adopiton agreement, loan policy and SPD) and cannot find where it addresses how extra repayments should be treated. The plan is a prototype plan and we use Relius Documents. If the extra should be paid all on the principal then this would definitely get the loan paid off much sooner so I want to make sure we apply this correctly.

Can anyone help me out with this?

Thanks!

[PensionPro]

Current payments as per the amortization schedule are applied to principal and interest. Any additional payments apply to principal only. Otherwise you end up making interest payments for interest which has not been accrued. Or paying the same amount of interest even though the loan term is shortened. Both of which do not make sense.