mitch672
Active Member
A co-worker changed jobs and he was able to pay the 401K loan off monthly without any penalty. He had a choice of paying it off all at once or paying it at the same rate as when he was employed. Because it's Federal it should be the same everywhere but perhaps it varies by plan policy.
My 401K does automatic payroll deductions to repay the loan, that can't be done if you are no longer an employee. It also gurantees the loan is paid off in a maximum of 60 months (the plans limit), and also the maximum loan amount is $50K, even if you have more in the 401K, so the rules are setup plan by plan. Mine must be paid off within 60 days...