Eligible to excluded class, loan payments

[Guest sviola]

If an eligible participant has a loan but then becomes part of an excluded class, is the employer still obligated to withhold and submit his loan repayments? I think yes.

[MoJo]

If an eligible participant has a loan but then becomes part of an excluded class, is the employer still obligated to withhold and submit his loan repayments? I think yes.

Just because the employee is no longer eligible to contribute to the plan doesn't mean they aren't still a participant in the plan, entitled to all of the rights & features thereof. So, yes, loan payment should/must still be made. Indeed, unless the plan otherwise restricts, they should also be able to take out new loans, or avail themselves of any other feature of being a participant in the plan.