With a 401(k) loan, you can pull money out of your 401(k) to pay for bills, living expenses, or whatever you need. And you can possibly avoid early withdrawal penalties and taxes if you're under 59 ½. You can take out as much as 50% of your vested account balance, up to a maximum of $50,000. Or, if 50% of your vested balance is less than $10,000, you may be able to borrow as much as $10,000. But in most cases, you'll have to repay your loan within five years (or less if you change jobs).
401(k) loans are commonly used to:
- Avoid foreclosure/eviction
- Clear IRS debt
- Buy a home
- Pay medical bills
- Cover emergencies
A 401(k) loan is often a better idea than an early withdrawal, but consider 401(k) loan alternatives and make sure you understand the rules first.
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Is it a good idea to borrow from your 401(k)?
It’s generally not a good idea to borrow from your 401(k) unless you’re purchasing an asset (like a house) that increases in value over time and has tax benefits, or you’re facing an emergency with very bad credit and have no other options. But according to a study by Fidelity Investments, 401(k) loans and withdrawals were on the rise in Q3 2023 — with more people using funds to pay for medical costs and to avoid foreclosure or eviction.
But borrowing from your 401(k) to cover daily expenses can create a repeated borrowing need, since it reduces your take-home pay. Take the opportunity to instead reevaluate your current budget and your tax deductions. If you’re used to getting a large refund at tax time, consider increasing your deductions so that money is spread out across your paychecks instead.
If you need to borrow for an emergency, consider other options, like an emergency loan. The interest rate will likely be higher, but you could have seven years or more to repay the loan, and you won’t need to jeopardize your retirement to make ends meet.
Tip
Going forward, consider whether an emergency savings plan or more robust insurance coverage could prevent the need to borrow from your 401(k).
How does a 401(k) loan work?
With a 401(k) loan, you borrow money from your own account, so there’s no credit check. You repay the balance plus interest over a maximum of five years. Your employer and the IRS have strict borrowing rules, which you need to follow to avoid a 10% early withdrawal penalty and income taxes on the amount withdrawn.
401(k) loan rules
- Loan amounts: You can borrow 50% or up to $50,000 of your vested account balance. However, some plans will let you borrow up to $10,000 if 50% of your vested account balance is less than $10,000.
- Repayment: In most cases, you must repay the loan in substantially equal payments on at least a quarterly basis within five years. If you’re unable to repay, the loan will be considered a distribution — making you liable for a 10% early withdrawal penalty and taxes on the balance.
- Spousal approval: 401(k) plans generally don’t require your spouse to consent to a loan or distribution, but check with your plan to be sure.
- Repayment terms: The maximum loan term is 5 years, unless the 401(k) loan is used to buy a primary residence. In this case, the repayment term may extend beyond 5 years.
- Remain with the same employer: To keep a 401(k) loan, you must keep your job during the repayment term. If you’re fired, laid off, or decide to quit, your remaining loan balance could be due immediately, depending on the employer. To avoid this, you may be able to roll a loan with an outstanding balance into an eligible retirement plan by the tax filing deadline. But in most cases, you'll need to pay the balance to avoid tax consequences and penalties for early withdrawal.
- Interest: In addition to repaying the principal balance, you must also pay interest on the amount borrowed. The amount is set by the plan administrator, but is based on prime. For example, a plan may charge 1% plus the prime rate. However, interest payments go into your own account.
- Loan fees: You may have to pay an origination fee to get the loan. Some loans also charge an annual fee for each year you haven’t repaid the loan in full. For example, Merrill Lynch charges a $75 establishment fee and a $75 annual fee.
401(k) loan double taxation
Some consider that taking a 401(k) loan results in double taxation of retirement funds. But like any loan you’d take from a bank, you’ll pay a 401(k) loan back with after-tax funds. You’ll also pay taxes when you withdraw those funds in retirement. Simply put, in order to spend money that’s been tax-deferred, you need to pay tax on it. An advantage with a 401(k) loan is that the interest you pay goes to yourself.
What if you can’t pay back a 401(k) loan?
Defaulting on a 401(k) loan is expensive. The remaining unpaid balance of the loan would get added to your gross annual income, so you’d pay taxes on it for that year — plus you’d pay an extra 10% penalty for early withdrawal if you were under 59 ½ when you took out the loan.
However, it’s unlikely you’d default if you remain with your employer. Remember, loan payments are deducted from your paycheck. But if you lose or change your job and don’t roll the loan into an eligible retirement plan, you’d have to pay it back in full. If you can’t, you’d default. If you do roll the balance into an IRA, for example, you’d need to make payments directly and could default if you stop making payments.
Bottom line: Don’t default on a 401(k) loan.
How to get a 401(k) loan
Here is how to take out a loan from your 401(k).
- Contact your employer: Most employer retirement plans have an online system housing your account info and self-servicing options. That’s where you’d go to take out a 401(k) loan. You could also call your employee benefits center to have someone talk you through the process.
- Review your balance: Run the numbers for a 401(k) loan using a retirement plan loan calculator to weigh the cost of borrowing. Don’t skip this step. You’ll want to know how this could impact your future.
- Determine how much you want to borrow: During the loan application, choose the loan amount you need. Remember, you can’t borrow more than 50% of your vested account balance or $50,000. However, if 50% of your vested balance is less than $10,000, you may be able to borrow up to $10,000.
- Understand your repayment terms, fees, and interest rate: Note any upfront fees charged, what the interest rate is, and how much will be deducted from your paycheck to pay back the loan. Also thoroughly review plan disclosures.
Try to answer these questions for yourself before finalizing the loan documents.
- Do the loan payments fit my budget?
- Do I have the reserves to pay this if I get laid off unexpectedly?
- Will I have time and resources to replenish my retirement savings?
- Is this really my only option? What alternatives am I not considering?
401(k) loans: Pros and cons
The disadvantages of taking a 401(k) loan could outweigh the pros. Be sure to read through to the alternatives below before making a final decision.
Pros
- Lower interest rate: The interest rate on a 401(k) loan is lower compared to other retail lending options. Typically, it’s the prime rate plus 1% to 2%. As of November 2023, the prime rate is 8.50%, which makes a 401(k) loan about 9.50% to 10.50% APR, depending on your plan’s administrator.
- Relatively fast funding: As early as your next paycheck, you could see the money in your account.
- No credit check: A 401(k) loan could be your only loan option if you have bad credit, since there’s no credit check to qualify.
- Automatic repayments: Repaying the loan is simple, as it comes directly from your paycheck before it reaches your account to spend.
Cons
- Limited loan amount: Since the IRS limits 401(k) loan amounts to 50% of your vested balance, you might not be able to borrow as much as you need.
- Potential penalties and taxes: If you lose your job and can’t pay back the loan, it’s considered a distribution and will be taxable as regular income. Plus, if you were under 59 ½ when you took out the loan, you’d owe an additional 10% on the amount of the distribution.
- Reduces potential gains: When you take a 401(k) loan, you’re pulling that money out of the stock market, where it potentially earns you more money. According to Merrill Lynch, a $10,000 loan on a balance of $50,000 that appreciates 5% annually could cost you almost $13,000 in missed gains over 5 years.
- Loan fees: You may have to pay fees for your 401(k) loan. Some employers tack on origination fees, annual fees, or default fees if you fail to repay the loan.
- No protection in bankruptcy. If you have to file bankruptcy to have your debts discharged, your 401(k) loan won’t be one of them. You’re still responsible for repaying the loan. On the bright side, the balance in your 401(k) is usually protected in bankruptcy.
401(k) loans vs. personal loans
Choosing to go with a personal loan may be better than a 401(k) loan, since it doesn’t impact your retirement savings. Although the interest is higher on average, personal loans provide greater flexibility regarding loan amounts, loan terms, and transferability between jobs. The downside is that you’ll need a good-enough credit score and sufficient income to qualify for a personal loan.
Learn More: 401(k) Loan vs. Personal Loan
4.24.2
Credible rating
Fixed (APR)
7.49% - 25.49%
Loan Amounts
$5000 to $100000
Min. Credit Score
700
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on Credible’s website
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Overview
Lightstream is one of three Credible partner lenders to offer loan amounts up to $100,000, which makes it ideal for financing large expenses like home improvements or weddings. Funds are available as soon as the same day you apply, and you'll have up to 12 years to repay certain types of loans, including home improvement loans, RV loans, and boat loans. There are no origination fees, and rates are low — as of this writing, Lightstream's lowest APR beats SoFi's advertised lowest APR by 1 percentage point. But you'll need good credit to qualify.
Note that unlike most lenders, Lightstream does not let you prequalify. Nor does it provide a contact phone number next to its customer service hours on its website.
Loan amount
$5,000 to $100,000
Repayment terms
2 - 12 years, depending on loan purpose
Fees
None
Discounts
Autopay
Eligibility
Available in all states except RI and VT
Min. income
Does not disclose
Customer service
Soft credit check
No
Time to get funds
As soon as the next business day
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Read full review
3.93.9
Credible rating
Fixed (APR)
7.80% - 35.99%
Loan Amounts
$1000 to $50000
Min. Credit Score
620
Check Rates
on Credible’s website
View Details
Overview
Upstart has one of the lowest available APRs of Credible partner lenders and of all non-partners we reviewed, making it a good choice for well-qualified applicants. However, it's also is one of few lenders that doesn't have a minimum credit score requirement (if you apply on the lender's website), which makes it an option if you have bad credit or no credit history. Upstart may charge an origination fee as high as 12%, but good-credit borrowers may not be charged one at all.
Trustpilot gives Upstart 4.9 stars, which is the highest of all lenders we reviewed.
Loan amount
$1,000 to $50,000
Fees
Origination fee
Discounts
None
Eligibility
Available nationwide
Min. income
$12,000
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 to 3 business days
Loan uses
Pay off credit cards, consolidate debt, relocate, make a large purchase, and other purposes
Read full review
4.44.4
Credible rating
Fixed (APR)
-
Loan Amounts
$2500 to $40000
Min. Credit Score
660
Check Rates
on Credible’s website
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Overview
Discover Personal Loans offers low APRs, repayment terms up to seven years, no origination fees, nationwide availability, and doesn't require your Social Security number to prequalify on its site. You'll need to have an annual income of at least $40,000, and a FICO score 660 or higher, to be eligible. If your credit score is fair or poor, you'll need to go elsewhere, as Discover doesn't allow cosigners.
Funds are available as soon as the next business day after loan approval.
Loan amount
$2,500 - $40,000
Repayment terms
3 - 7 years
Fees
Late fee
Discounts
None
Eligibility
Available in all 50 states
Min. income
$40,000
Customer service
Phone
Soft credit check
Yes
Time to get funds
Funds can be sent as soon as the next business day after acceptance
Loan uses
Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding
Read full review
4.64.6
Credible rating
Fixed (APR)
8.49% - 17.99%
Loan Amounts
$600 to $50000
Min. Credit Score
760
Check Rates
on Credible’s website
View Details
Overview
PenFed is a credit union that offers personal loans to applicants with good credit. Though you'll need to become a member to receive a loan, membership is open to everyone. PenFed shines with no origination fees, small available loan amounts, and low interest rates. If you don't have a FICO score above 700, you may not qualify on your own, but can apply with a cosigner with good credit — which is not something most lenders offer.
PenFed doesn't have a minimum income amount, and offers live chat and an entirely online loan application process.
Loan amount
$600 to $50,000
Fees
Unsuccessful payment fee, late fee
Discounts
None
Eligibility
Does not disclose
Min. income
No flat restriction
Customer service
Phone, email, live chat
Soft credit check
Yes
Time to get funds
Typically 1 to 2 business days after verification
Loan uses
Debt consolidation, home improvement, credit card refinancing
Repayment terms
12 to 60 months
Read full review
4.54.5
Credible rating
Fixed (APR)
8.49% - 35.99%
Loan Amounts
$1000 to $50000
Min. Credit Score
600
Check Rates
on Credible’s website
View Details
Overview
Upgrade has a suite of features that make it a very attractive lender: competitive interest rates, discounts for direct pay and autopay, as soon as same-day funding, up to seven-year repayment terms, and nationwide availability. Plus, loans are available to fair-credit borrowers, and you don't need to input your Social Security number to prequalify on the website. Upgrade even offers secured personal loans, which is not common among lenders.
However, Upgrade does charge an origination fee of 1.85% to 9.99%. You must have a FICO score of at least 600 and a minimum income of $25,000 annually to qualify.
Loan amount
$1,000 to $50,000 ($3,005 minimum in GA; $6,600 minimum in MA)
Repayment terms
2 to 7 years
Fees
Origination fee
Discounts
Autopay and direct pay
Eligibility
Available in all states
Min. income
Does not disclose
Customer service
Soft credit check
Yes
Time to get funds
1 business day
Loan uses
Credit card refinancing, debt consolidation, home improvement, major purchase, other
Read full review
4.94.9
Credible rating
Fixed (APR)
8.99% - 29.99%
Loan Amounts
$5000 to $100000
Min. Credit Score
Does not disclose
Check Rates
on Credible’s website
View Details
Overview
SoFi stands out for offering no-fee personal loans with competitive rates, high loan amounts, long loan terms, discounts for autopay and direct pay, and funding as soon as the same day. Plus, SoFi prioritizes convenience for existing and potential customers with features like live chat and an easy prequalification process that doesn't require your Social Security number. Once you have a loan with SoFi, you may be eligible for unemployment protection and unemployment assistance.
The main catch is that you need to qualify for a loan with SoFi, which can be hard to do if you don't have good credit. You also won't be able to apply with a cosigner, since SoFi doesn't accept cosigners; nor does it offer secured personal loans.
Loan Amount
$5,000 to $100,000
Repayment terms
2 - 7 years
Fees
Option to pay an origination fee (up to 6%) in exchange for a lower rate
Discounts
Autopay, direct pay
Eligibility
Available in all states
Min. income
Does not disclose
Customer service
Phone, email, live chat
Soft credit check
Yes
Time to get funds
Typically within a few days, given approval and bank account verification, but sometimes within the same day
Loan uses
Solely for personal, family, or household uses
Read full review
44
Credible rating
Fixed (APR)
8.99% - 35.99%
Loan Amounts
$2000 to $50000
Min. Credit Score
600
Check Rates
on Credible’s website
View Details
Overview
Best Egg is a solid lender for a wide range of borrowers. It offers competitive rates, reasonable loan terms and amounts, and personal loans for fair credit. You'll need a FICO score of at least 600 to qualify, but the lower your score, the higher your APR may be. The APR includes the interest rate and origination fees, which range from 0.99% to 8.99% with Best Egg.
Note that if you successfully prequalify with Best Egg, you may be more likely to be approved for the loan relative to other lenders you prequalify with. Based on Credible data, borrowers who chose to apply for a loan with Best Egg were more than twice as likely to be approved (relative to most other Credible partners).
Loan amount
$2,000 to $50,000
Fees
Origination fee, late fee, unsuccessful payment fee, check processing fee
Discounts
None
Eligibility
Available in all states except DC, IA, VT, and WV
Min. income
None
Soft credit check
Yes
Time to get funds
As soon as 1 to 3 business days after successful verification
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Read full review
44
Credible rating
Fixed (APR)
9.57% - 35.99%
Loan Amounts
$1000 to $40000
Min. Credit Score
660
Check Rates
on Credible’s website
View Details
Overview
LendingClub is a solid lender for good credit borrowers and some fair credit borrowers that apply directly on its website. It's easy to prequalify with LendingClub, especially if you're uncomfortable providing your Social Security number, as the company doesn't require it at the prequalification stage. (You will need to provide it if you move forward with a full application.)
While prequalification is not a guarantee that you'll be approved for a loan, LendingClub does a better job than most other Credible partner lenders at approving applicants that have successfully prequalified. In other words, you're less likely to have your application declined once you apply (if you've already prequalified). LendingClub may charge an origination fee between 3% and 6%.
Loan amount
$1,000 to $40,000
Fees
Origination fee
Discounts
None
Eligibility
Available in all 50 states
Min. income
None
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
Usually takes about 2 days
Loan uses
Debt consolidation, paying off credit cards
Read full review
3.93.9
Credible rating
Fixed (APR)
9.95% - 35.99%
Loan Amounts
$2000 to $35000
Min. Credit Score
550
Check Rates
on Credible’s website
View Details
Overview
Avant personal loans are a good choice for borrowers with bad credit looking for small- to moderate-sized personal loans. Loans are available up to $35,000 and you could get the money as soon as the next business day after approval. Plus, Avant is more likely than some lenders to approve the applications of borrowers who've prequalified with Avant. However, the lender charges an origination fee up to 4.75%, and its top-range interest rates are among the highest of the lenders we reviewed.
Loan amount
$2,000 to $35,000**
Fees
Origination fee, late fee, dishonored payment fee
Discounts
None
Eligibility
Available in all states except HI, IA, MA, ME, NY, VT, and WV
Min. income
$1,200 monthly
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)
Loan uses
Debt consolidation, emergency expense, life event, home improvement, and other purposes
Repayment terms
1 to 5 years (2 to 5 years through Credible)
Read full review
4.34.3
Credible rating
Fixed (APR)
11.69% - 35.99%
Loan Amounts
$1000 to $50000
Min. Credit Score
560
Check Rates
on Credible’s website
View Details
Overview
Universal Credit is one of a handful of lenders that offers personal loans for bad credit. If your FICO credit score is at least 560, you may be eligible for a Universal Credit personal loan. It offers loan amounts up to $50,000, repayment terms up to seven years, and discounts for direct pay and autopay. Funds are available as soon as the next business day after loan approval.
Note that rates and fees can be relatively high — you may pay an origination fee from 5.25% to 9.99%, and APRs start at 11.69%. If you get a loan with a high interest rate, consider refinancing your personal loan at a lower rate once you've improved your credit score.
Loan amount
$1,000 - $50,000
Repayment terms
3, 5, or 7 years
Fees
Origination fee
Discounts
Autopay and direct pay
Eligibility
A U.S. citizen or permanent resident; not available in DC, IA, SC, WV
Min. income
None
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 business day after acceptance
Loan uses
Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchases
Read full review
3.93.9
Credible rating
Fixed (APR)
11.72% - 17.99%
Loan Amounts
$3000 to $40000
Min. Credit Score
640
Check Rates
on Credible’s website
View Details
Overview
Happy Money has been in operation since 2009 (formerly known as Payoff). It's an option for fair-credit borrowers (plus those with better credit), and notably has a relatively low top-end APR. In other words, you could qualify for a lower rate with Happy Money with fair credit, relative to other lenders that offer fair-credit loans. The company does charge an origination fee on some loans, up to 5%, but that's not as high as some other lenders' origination fees.
You should be prepared to wait a few days to get your money, as funding can take three to five days once approved. And loans aren't available in Massachusetts or Nevada. Happy Money has an A+ rating with the BBB and is ideal for debt consolidation and credit card consolidation loans.
Loan amount
$5,000 to $40,000
Fees
Origination fee
Discounts
None
Eligibility
Available in all states except MA, MS, NV, and OH
Min. income
None
Customer service
Phone, email, chat
Soft credit check
Yes
Time to get funds
As soon as 2 - 5 business days after verification
Loan uses
Debt consolidation and credit card consolidation only
Read full review
44
Credible rating
Fixed (APR)
-
Loan Amounts
$20000 to $200000
Min. Credit Score
660
Check Rates
on Credible’s website
View Details
Overview
BHG Money stands out for offering the largest loan amounts — up to $200,000 — of any Credible partner lenders. Simply put, if you need an unsecured personal loan over $100,000, there are very few places to look, but BHG is one. You'll have up to 10 years to repay the loan, but you'll need an annual income of at least $100,000 to qualify and a FICO score that's 660 or higher. However, if you have a cosigner that meets these requirements, BHG will consider your application.
Loan amounts start at $20,000, so look elsewhere for small loans. And BHG charges a modest origination fee between 2% and 4%, depending on your financial profile. Loan funds are available within three to 14 days of loan approval. Note that you can't prequalify with BHG.
Loan amount
$20,000 - $200,000
Repayment terms
3 - 10 years
Fees
Origination fees, late fees
Discounts
None
Eligibility
Available in all states except Maryland and Illinois
Min. income
$100,000
Customer service
Email, phone
Soft credit check
Not on lender's site
Time to get funds
In as few as 5 days
Loan uses
Debt consolidation, baby (adoption), engagement ring financing, moving (relocation), business, home improvement, special occasion, cosmetic procedures, major purchase, taxes, credit card refinancing, medical expenses, vacation, wedding, other
Read full review
3.73.7
Credible rating
Fixed (APR)
14.30% - 35.99%
Loan Amounts
$3500 to $40000
Min. Credit Score
640
Check Rates
on Credible’s website
View Details
Loan amount
$3,500 to $40,000
Fees
Origination Fee, $15 Late Fee, $25 NSF Fee
Discounts
None
Eligibility
Available in all states except CO, CT, ME, NV, NH, TN, VT, WV, WY, and all U.S. Territories
Min. income
$1,000 monthly
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
Funds typically deposited into your account in 1 business day13
Loan uses
Debt consolidation, credit card refinancing
Read full review
3.93.9
Credible rating
Fixed (APR)
18.00% - 35.99%
Loan Amounts
$1500 to $20000
Min. Credit Score
540
Check Rates
on Credible’s website
View Details
Overview
OneMain Financial has multiple options for bad-credit personal loans. The minimum credit score required is 540, which means you could get a loan with bad credit (FICO below 580). Plus, cosigners are allowed — a cosigner is someone (ideally, with good credit) who promises to repay the loan if you can't, which can make it easier to qualify or lower your rate. And, secured personal loans are available. You secure a loan with collateral, which may also help you qualify or lower your rate.
Rates are higher than competitors and OneMain charges origination fees as either a flat fee up to $500, or a percentage from 1% to 10% (depending on your state of residence). Note that even if you prequalify for a personal loan with OneMain, getting approved isn't a given.
Loan amount
$1,500 to $20,000
Fees
Origination fee, unsuccessful payment fee, late fee
Discounts
None
Eligibility
Must have photo I.D. issued by U.S. federal, state or local government
Min. income
Does not disclose
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 to 2 days after acceptance
Loan use
All except business, and education
Read full review
All APRs reflect autopay and loyalty discounts where available | LightStream disclosure | SoFi Disclosures | Read more about Rates and Terms
401(k) hardship distribution
Depending on your situation, you might qualify to claim a hardship distribution from your 401(k) — which means no loan, no repayment, and no 10% penalty for early withdrawal. You’re required to have an “immediate and heavy financial need” and are limited to withdrawing only the amount necessary to satisfy that need. For example, you might qualify if you’re facing:
- Certain medical expenses
- Costs to buy a home
- Tuition and educational expenses
- Eviction or foreclosure on your primary home
- Funeral and burial costs
- Essential repairs for damage to your home (in some cases)
- Losses from a federal disaster declaration
Alternatives to a 401(k) loan
- Personal loan: A personal loan is probably the closest in function to a 401(k) loan. You’ll get the best rates with good credit, but may still qualify for a bad-credit personal loan, especially if you have a cosigner or can secure the loan with collateral.
- State, local, and government programs: Down payment assistance programs (if you’re buying a home) may help with your down payment, provided that you meet program qualifications.
- Equity in your home: A home equity loan or line of credit is a loan that uses your residence as collateral and often carries lower interest rates than other alternatives. You need to have sufficient equity in your home and good enough credit to qualify, and, because the loan is secured by your home, you could lose it if you default.
- Revolving credit: A credit card that has a low or 0% promotional APR could be an excellent alternative to a 401(k) loan. You’ll need good credit to qualify and should pay off all or a bulk of the amount you borrow within the low APR period.
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401(k) loan FAQ
Can I take out a 401(k) loan if I have an outstanding loan from another retirement account?
You can take out a second loan on your 401(k) if you already have an outstanding loan. It just can’t exceed the lesser of $50,000 or 50% of your vested balance.
What happens to my 401(k) loan if I change jobs or get laid off?
If you’ve changed jobs, been laid off, or decided to quit, the full remaining balance of your 401(k) loan could be due immediately or within the next 90 days. To avoid this, you can roll that balance into an IRA or other eligible retirement account and continue making payments.
Meet the expert:
Seychelle Thomas
Seychelle Thomas (she/her) is an ex-banker of seven years turned personal finance writer. She's a Nav-certified credit and lending expert who is passionate about empowering people to make smart financial decisions. In her writing, she explores a variety of debt consolidation, budgeting, credit, and lending topics.