Common use of Loan Provision Clause in Contracts

Loan Provision. On August 14, 2012, the Board of Supervisors adopted Resolution 2012/348 approving a side letter with the Coalition Unions to allow a Deferred Compensation Plan Loan Program effective September 1, 2012. The following is a summary of the provisions of the loan program: 1. The minimum amount of the loan is $1,000 2. The maximum amount of the loan is the lesser of 50% of the employee’s balance or $50,000, or as otherwise provided by law. 3. The maximum amortization period of the loan is five (5) years. 4. The loan interest is fixed at the time the loan is originated and for the duration of the loan. The loan interest rate is the prime rate plus one percent (1%). 5. There is no prepayment penalty if an employee pays the balance of the loan plus any accrued interest before the original amortization period for the loan. 6. The terms of the loan may not be modified after the employee enters into the loan agreement, except as provided by law. 7. An employee may have only one loan at a time. 8. Payment for the loan is made by monthly payroll deduction. 9. An employee with a loan who is not in paid status (e.g. unpaid leave of absence) may make his/her monthly payments directly to the Plan Administrator by some means other than payroll deduction each month the employee is in an unpaid status (e.g. by a personal check or money order). 10. The Loan Administrator (MassMutual Life Insurance Company or its successor) charges a one-time $50 loan initiation fee. This fee is deducted from the employee’s Deferred Compensation account. 11. The County charges a one-time $25 loan initiation fee and a monthly maintenance fee of $1.50. These fees are paid by payroll deduction. The County’s website provides employees with the following information: a. Deferred Compensation Loan Provision b. FAQ’s for the Loan Provision including loan status upon termination of employment and the consequences of defaulting on a loan c. Pros and Cons of borrowing from the Deferred Compensation Plan d. Loan Application and Agreement

Loan Provision. On August 14, 2012, 2012 the Board of Supervisors adopted Resolution 2012/348 approving a side letter with the Coalition Unions to allow a Deferred Compensation Plan Loan Program effective September 1, 2012. The following is a summary of the provisions of the loan program: 1. The minimum amount of the loan is $1,000. 2. The maximum amount of the loan is the lesser of 50% of the employee’s balance or $50,000, or as otherwise provided by law. 3. The maximum amortization period of the loan is five (5) years. 4. The loan interest is fixed at the time the loan is originated and for the duration of the loan. The loan interest rate is the prime rate plus one percent (1%). 5. There is no prepayment penalty if an employee pays the balance of the loan plus any accrued interest before the original amortization period for the loan. 6. The terms of the loan may not be modified after the employee enters into the loan agreement, except as provided by law. 7. An employee may have only one loan at a time. 8. Payment for the loan is made by monthly payroll deduction. 9. An employee with a loan who is not in paid status (e.g. unpaid leave of absence) may make his/her monthly payments directly to the Plan Administrator by some means other than payroll deduction each month the employee is in an unpaid status (e.g. by a personal check or money order). 10. The Loan Administrator (MassMutual Life Insurance Company or its successor) charges a one-time $50 loan initiation fee. This fee is deducted from the employee’s Deferred Compensation account. 11. The County charges a one-time $25 loan initiation fee and a monthly maintenance fee of $1.50. These fees are paid by payroll deduction. The County’s website provides employees with the following information: a. Deferred Compensation Loan Provision b. FAQ’s for the Loan Provision including loan status upon termination of employment and the consequences of defaulting on a loan c. Pros and Cons of borrowing from the Deferred Compensation Plan d. Loan Application and Agreement.