403(b) Loan Provisions

(Revised June 2016)

Instructions for Loan Application from the MSU 403(b) Retirement Plan

Please read the following information and instructions carefully, as the requirements for loans have changed.

Effective January 1, 2009, loans are available to active MSU employees from the 403(b) Retirement Plan (including the Base and/or Supplemental). The minimum loan amount is $1,000. Employees may have a maximum of two (2) MSU 403(b) Retirement Plan loans outstanding at one time. An employee who at any time has defaulted on a loan(s) from the MSU Plan (from any investment sponsor) will not be eligible to receive another loan from the Plan unless the defaulted loan(s) is repaid in full. Fidelity is the only MSU approved investment vendor allowed to issue new loans. If you do not have an account with Fidelity, please review step 4 below for further detail. Loans are only available for specific purposes, which are listed in step 1.

Loan Process Documents:

Step-by-Step Instructions:

1. Complete the MSU 403(b) Retirement Plan Loan Application Form. All sections of the form must be fully completed.

  1. Section A - complete your personal information, including your email address.
  2. Section B - select the loan purpose(s) that apply. The nine purposes listed on the form are the only available criteria.
      • To purchase applicant's principal residence
      • To prevent eviction from or foreclosure on applicant's principal residence
      • To pay for college tuition expenses for applicant or family member*
      • To pay medical expenses for applicant or family member*
      • To pay for funeral expenses for family member*
      • To pay for home repair due to a major disaster to applicant's principal residence
      • To pay applicant's expenses if applicant is unable to cover them due to layoff
      • To support applicant's structured financial plan to eliminate debt and/or avoid bankruptcy
      • To pay for applicant's expenses to adopt a child
  3. Section C - enter the amount of loan
  4. Section D - sign, add ZPID or last four digits of Social Security Number, and date form

2. Please retain copies of all the appropriate documentation that supports the loan purpose(s) selected and the loan amount requested, in the event of a future audit. 

3. Return the MSU 403(b) Retirement Plan Loan Application Form to MSU Human Resources at:

MSU Human Resources
1407 S. Harrison Road
Suite 110 Nisbet Building
East Lansing MI 48823-5239
Fax: 517-353-1869

Human Resources Retirement will contact you by email within three (3) business days of submission to notify you if your loan application is accepted. If your MSU 403(b) Loan Application Form is incomplete, your application will not be accepted. Incomplete applications will require re-submission by the employee.

4. Contact Fidelity to request your loan. You may request the loan online with Fidelity or by phone with Fidelity's Customer Service at 800-343-0860. The loan amount requested at Fidelity should be equal to or less than the amount identified on your 403(b) Loan Application Form.

If you have balances in more than one Fidelity account, you may consider transferring some or all of your pre-2012 Fidelity account balance (MSU 403B PRE 2012) into your current Fidelity account (Mich State Univ 403B), so you only need to take out one loan from Fidelity.

Note: If you do not currently have an account at Fidelity, you will need to open an account by transferring a portion of your MSU 403(b) account balance (Base and/or Supplemental) from one of the approved MSU investment sponsors to Fidelity. The amount of the transfer must be at least twice the amount listed on the loan application. Before you transfer the balance, you may want to first review the email that Human Resources Retirement Office sends to notify you if your loan application has been accepted.

Direct Deposit and Loan Repayment with Fidelity require the employee to set-up their bank account information. Fidelity has a fifteen (15) day set-up processing time for new banking information. Fidelity loan(s) will be taken out prorated across both parts of the MSU 403(b) Plan.

5. Fidelity will record your loan request online once their request process has been completed. Human Resources Retirement will review the MSU 403(b) Loan Application Form, and will approve or decline your Fidelity loan request via the web. Employees may confirm completion of the loan process by accessing their Fidelity account.

 

* "Family Member" is defined as one or more of the following:

  • An Internal Revenue Code (IRC) defined Dependent relationship, which is either a "qualifying child" or a "qualifying relative"
    • A qualifying child is a son or daughter (or stepson or stepdaughter), a legally adopted child, a foster child, brother or sister (or stepbrother or stepsister) of the applicant, or a descendant or one of these
    • A qualifying relative is a child (or a descendant), brother or sister (or stepbrother or stepsister), mother or father (or stepmother or stepfather), niece or nephew, aunt or uncle, grandmother or grandfather, or in-law (father, mother, sister, brother, son, or daughter) of the applicant or has the same principal residence as the applicant (other than the spouse) and is a member of the applicant's household
  • A Legal Spouse
  • An MSU defined Other Eligible Individual