How to get a solo 401k loan with Carry
The Carry Solo 401k supports the ability to take out a loan from your plan. You’re allowed to borrow up to 50% of your account value, up to a maximum of $50,000.
Solo 401k loans are fast, there are no credit checks, you can use the money for whatever you want, and you have up to 5 years to pay it back. If you’re using the money from the loan to acquire a dwelling unit as your principal residence, you may get up to 30 years for repayment.
The interest rate is prime rate (as reflected in the Wall Street Journal on the date of the loan) + 1%. You may qualify for a lower interest rate if you’re on active duty in the military.
Here’s how it works.
Step 1: Contact us to let us know you want to take out a solo 401k loan
The first step is to reach out to us and let us know that you want to take out a solo 401k loan. We’ll talk you through the process, and then send over forms you can sign online and send back to us.
Once we receive the signed forms, you’ll receive a confirmation email from us with instructions on how to initiate the loan withdrawal from the Carry app. The steps below show you how to complete the next steps once you’ve received the confirmation email from us.
Step 2: Go to your solo 401k account page and click withdrawal
Note that if you do not have enough cash in the account to cover the loan amount, you will need to sell positions in securities so that the appropriate amount of funds are available as cash.
Once you’re ready, click the Transfer or Withdraw button
Then choose the Withdraw option.
Step 3: Enter in the loan amount
Once you’re on the withdrawal screen, enter in the amount of the loan, the solo 401k account you’re taking the loan from, and the bank account you want the funds to be sent to. Choose Loan as the reason for withdrawal.
Submit your withdrawal and you’re done.
It will take a few business days for the funds to arrive in your bank account and you’ll receive a confirmation of your loan withdrawal via email once it’s been processed.
How to make repayments back into your solo 401k plan
To make a loan repayment, simply deposit money into your solo 401k plan and choose the “Loan repayment” option as the contribution type.