What are my options for repaying the loan after it has gone into default?

Personal Check to Payoff Loan:
The loan can be paid off. However, the only option available is a LUMP SUM payment of the entire loan default amount plus any accrued interest.

Forfeit Outstanding Defaulted Loan:
When a participant incurs a triggering event - turns age 59 1/2, severs from service, is disabled or dies - the loan can be forfeited, or internally surrendered. A financial hardship is NOT a qualifying reason to forfeit an outstanding loan!

If the contract has an '88 Grandfathered amount remaining on the contract, this amount is available to withdraw in order to pay off the defaulted loaned amount plus any accrued interest. However, if there is not enough '88 grandfathered amount available to make the total payment, this option is not available. In order to exercise this option, Security Benefit must be notified in writing.



Nothing contained herein is intended to be, nor should it be construed as tax or legal advice. If you have a tax question or legal question, please consult your tax professional or attorney.

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