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Part 5004 - Loans

Section 5004.8 - The Effect on Unpaid Loans of Death, Retirement, Withdrawal or Transfer to another Retirement System for Tiers I and II

(a) A Tier I/II loan shall become due and payable upon death, retirement, withdrawal or transfer to another retirement system.

(b) In the event such amount is not repaid, the balance of the loan with interest and insurance premium to date shall be deducted from the member's annuity savings account.

(c) In the case where a borrowing member dies prior to the repayment of a loan not in default  after the loan shall be fully insured and there are payments on this loan which are in arrears at the date of death, the arrears payments shall be deducted from the member's annuity savings account and the balance of the loan shall be closed to the Retirement System Insurance Fund.

(Statutory authority: Education Law, §512-b; Retirement and Social Security Law, §§517-b, 613-a)