This Directive was Canceled June 23, 1999.
U.S. Department of Transportation
Federal Highway Administration
NOTICE
THRIFT SAVINGS PLAN (TSP) LOAN PROGRAM
N 3830.9
March 9, 1989
- PURPOSE. To provide general information on changes in the Thrift Savings Plan (TSP) Ioan Program.
- BACKGROUND. The TSP, a retirement savings and investment plan for
Federal employees, includes a loan program as one of its features. Employees
who are participants in the TSP may borrow the amount of their contributions
and the earnings on them for the purchase of a primary residence, educational
expenses, medical expenses, and financial hardship.
- CHANGES TO TSP LOAN PROGRAM. Changes have been made which extend
the previous $1,000 limit on hardship loans and allow participants who already
have an outstanding loan to apply for a second loan.
- DOCUMENTED FINANCIAL HARDSHIP LOANS. The previous financial hardship
loan was limited to $1,000 and required only a self-certification of financial
need. Participants may now obtain a hardship loan in amounts of $1,000 or
more by using a new form, TSP-20-H, Hardship Loan Application. Since it requires
financial information in support of the application, the hardship loan is
referred to as a "documented hardship loan."
- After March 31, 1989, the current self-certified hardship loan will
be eliminated from the TSP Loan Program, and only documented hardship
loan applications will be accepted. Until that time, participants may
apply for the $1,000 self-certified loan by submitting the current Form
TSP-20 to the TSP Service Office. Participants who apply and qualify for
the self-certified loan, using Form TSP-20, will receive from the TSP
Service Office, a TSP Loan Agreement/Promissory Note and associated forms
for this loan, along with a copy of the new Hardship Loan Application
Form (TSP-20-H). The TSP will ask applicants to accept the $1,000 loan
or to cancel the application for the self-certified hardship loan and
apply for a larger documented hardship loan, Alternatively, participants
may apply directly for a documented hardship loan using the new application form.
- Applicants for a documented hardship loan must complete and sign Form
TSP-20-H and return it, along with a copy of their most recent Earnings
and Leave Statement, directly to the TSP Service Office. At present, the
new Form TSP-20-H may only be obtained by calling or writing:
National Finance Center
Thrift Savings Plan Service Office
P.O. Box 61500
New Orleans, LA 70161-1500
Telephone (FTS) 680-6050 or (Commercial) 504-255-6050
- To be eligible for a documented hardship loan of $1,000 or more, participants
must show that their regular monthly expenses exceed their net monthly
income (i.e., income after taxes and retirement deductions) and that they
do not have sufficient financial assets. Financial assets are defined
as cash or other assets that are readily converted to cash. Applicants
may also qualify if they have certain defined extraordinary expenses that
cannot be covered by one month's net income and if they do not have sufficient
financial assets. Other tests for eligibility are outlined in the "Thrift
Savings Plan Loan Program" booklet.
- SECOND TSP LOANS. Participants may now apply for a second TSP loan.
Restrictions on the types of loans that may be obtained when the applicant
has a current outstanding TSP loan are summarized below:
If current oustanding loan is: |
You may apply for a second loan for: |
|
Res. |
Ed. |
Med. |
Self-cert. hardship |
documented hardship |
Residential |
no |
yes |
yes |
yes* |
yes |
Education |
yes |
yes |
yes |
yes* |
yes |
Medical |
yes |
yes |
yes |
yes* |
yes |
Hardship |
|
- self-certified
|
yes |
yes |
yes |
no |
yes |
- documented
|
yes |
yes |
yes |
yes* |
no** |
* Through March 31, 1989
** Initially only one documented hardship loan may be outstanding. At a
later date, a second such documented hardship loan may be permitted
- FOR ANSWERS TO QUESTIONS. Employees may contact their servicing personnel
office for additional information . Washington Headquarters employees may
call 366-4031. Copies of the TSP Loan Program booklet and the current form
TSP-20 for other types of loans may also be obtained from these sources.
/s/
Rosalie R. Wilson
Director, Office of Personnel
and Training
This Directive was Canceled June 23, 1999.
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