Interest rate cut from 8.4% to 1.25% on all existing and new loans
Trustees also remind members that loans don’t go into default until after end of 2nd quarter
Yesterday, the trustees of The Local 814 Annuity Fund — lead by union-side Trustees President Jason Ide and Secretary-Treasurer Walter Taylor — approved a motion to cut the interest rate on any currently outstanding and any new annuity fund loans from the current 8.4% to 1.25%.
As the letter being mailed to participants explains below, the new, lower interest rate will apply to re-payments on existing or new loans starting on April 1st. That means a member’s monthly loan re-payment amount will be significantly reduced starting on that date.
Also, because many members often do not realize how flexible the current loan re-payment rules are, the trustees made sure to have the default rules re-explained in detail.
As the letter explains, loans will not default until the last day of each quarter for the non-payment of the previous quarter
For example – You will not incur a default for your loan repayments due in April, May, and June 2020 payments unless you do not make those payments by September 30, 2020.
For more examples see the table below:
Payments Default date
Jan, Feb, March. June 30th
April, May, June. Sept 30th
July, Aug, Sep. Dec 31st
Oct, Nov, Dec. March 31st
Further, President Ide and Secretary Taylor are working with management-side trustees and fund staff to see if additional annuity-related relief can be enacted as well.
- A proposal to allow lump sum hardship withdrawals on contributions made within a specific recent window is currently being considered and we will update the membership if there are any developments.
- Another proposal, which could extend the time-line to repay a loan before it goes into default, is also being considered but, by law, requires the approval of the IRS
For further clarification on any of theses measures please call The Northern New Jersey Teamster Benefit Funds at 1-800-250-3121 or leave a message at the union hall for President Ide or Secretary-Treasurer Taylor.
Full letter below: