Updated by Chandler Julian
Can I Request a Loan Through My 401(K)?
It depends on your plan because not every plan offers loans. If you're unsure if your plan allows for loans, you can check with us or ask your employer.
How Much Can I Request?
The amount available for a 401(K) loan derives from of your vested account balance. However, there are other restrictions on how much can be requested. Typically, a 401(K) loan cannot exceed the lesser of:
1. $50,000 minus the highest outstanding loan balance you have had in the past 12 months.
2. 50% of your vested account balance.
How Do I Take a Loan From My Account?
There are two ways you can request a loan:
Online Loan Request:
To request a loan online, follow the steps below:
- Log into online account at www.erisa.com/login/
- Select the “Loans” from the Loans & Withdrawals menu section.
- Then click "View & Model Loan"
- Model Your Loan. Here, you will draft your loan as you see fit. Enter the available amount desired, the number of terms for the loan, and the payroll cycle.
- Once satisfied, select the “Calculate Payment” button.
- To finalize your loan request, select the “Request Loan button” button.
- E-Sign your loan paperwork - you will receive a DocuSign email with a link for you to e-sign your loan's promissory note. After you sign, DocuSign will automatically route your request to your employer for final approval.
Paper Loan Request:
To request a loan by paper application, follow the steps below:
- Request the application from us
- Complete and return the application to us using one of the following methods:
- upload your form to us using the Secure File Upload
- mailing your form to P.O. Box 22968 Nashville, TN 37202
- fax your form to 1-877-485-4104
Once you have requested the loan and returned any paperwork, you will be provided a copy of a promissory note. Your loan request cannot be finalized without returning the signed promissory note.
How Long will it take my Loan Proceeds to Arrive?
Once you have completed the application and promissory note, your employer will need to review and approve the request. Your check will be issued from Charles Schwab Bank and mailed using USPS. It can take up to twelve (12) days for your loan check to reach your mailing destination.
If you need your loan proceeds sooner, you can request next business day delivery via UPS for an additional $40 fee.
How Do I Start Repaying My Loan?
Payments are made by deducting the repayment amount from your paycheck. Your payroll administrator will be notified of your loan once the approved by your employer. You may view your repayment history in your online account by selecting Loans from the Loans & Withdrawals tab.
While deducting loan payments from your paycheck is the safest and easiest way to repay a loan, this does not guarantee payments will be made perfectly each pay period. Please review your paystubs and repayment history regularly to avoid late payments or loan defaults.