The Penultimate Loan Quiz

10 Questions | Total Attempts: 91

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The Penultimate Loan Quiz

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Questions and Answers
  • 1. 
    What are the max number of loans can a participant have outstanding at a time?  
    • A. 

      One for Small Market, One for Mid and Large Market

    • B. 

      Two for all Markets

    • C. 

      Three for Small Market, Five for Mid and Large

    • D. 

      Unlimited for all Markets

  • 2. 
    What is the maximum a participant can borrow
    • A. 

      100% of their total balance minus earnings but no more than 50K in a rolling 12 month period

    • B. 

      50% of their vested balance but no more than 50K in a rolling 12 month period

    • C. 

      25% of their vested balance

    • D. 

      50% of their vested balance but no more than 25K in a rolling 12 month period

  • 3. 
    What is the difference between a home loan and general loan?
    • A. 

      There are no differences

    • B. 

      ADP does not allow loans on homes

    • C. 

      Home loans can be for up to 15 years while general loans are only up to 5

    • D. 

      Home loans can be for up to 30 years while general loans are only up to 5

  • 4. 
    How much is the loan fee?
    • A. 

      50.00

    • B. 

      125.00 for Small Market and Varied for Mid and Large

    • C. 

      175.00 for Small Market and 100.00 for Mid and Large

    • D. 

      There is not a fee to take a loan

  • 5. 
    What is a loan reamortization?
    • A. 

      Lowering your payments

    • B. 

      Extending the term of the loan

    • C. 

      Shortening the number of payments

    • D. 

      None of the above

  • 6. 
    Is there a 10% penalty if a loan is taken?
    • A. 

      Yes, there is upon taking the loan

    • B. 

      No, as long as they pay it back there is not

  • 7. 
    A plan should not request a refinance on an employees loan if they have an additional loan available
    • A. 

      True

    • B. 

      False

  • 8. 
    When a Loan is Re-Amortized, the current interest rate will be used, not the employee's original interest rate
    • A. 

      True

    • B. 

      False

  • 9. 
    Aside from the active duty military exception, when Re-amortizing or refinancing a loan, the loan must be paid off by the end date of the original loan request. A loan CANNOT be re-amortized for a longer period
    • A. 

      True

    • B. 

      False

  • 10. 
    As per the IRS regulations, deemed distributed loan is considered as an active loan on our recordkeeping system.  If the plan only allows a participant to have one outstanding loan at a time and they have a deemed loan, we will still allow the participant to take another loan, we will just subtract the deemed loan from the amount available
    • A. 

      True

    • B. 

      False

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