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Loan types and terms

Before taking out a loan, you should carefully consider its potential effect on your retirement income.

The current loan interest rate on new loans is --%, which is the current G Fund interest rate.

How a TSP loan works

When you take a loan, you borrow from your contributions to your TSP account. Your loan amount can’t exceed the amount of your own contributions and earnings from those contributions. Also, you cannot borrow from contributions or earnings you get from your agency or service.

If you meet the loan eligibility rules and your loan request is approved, the loan amount is removed from your TSP account. You must repay your loan with interest. Generally, loans are repaid through payroll deductions. Your repayments restore the amount of your loan, plus interest, to your account. For additional information, visit Repaying your loan.

Loan types and terms

We allow two types of loans:

General Purpose Residential
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May be used for any purpose

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May only be used for the purchase or construction of a primary residence

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Requires no documentation

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Requires documentation

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Has a repayment term of 1 to 5 years

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Has a repayment term of 1 to 15 years

For details, visit Residential Loan Documentation.

Loan eligibility

To be eligible for a loan, you:

Residential loan eligibility rules

Residential loans have specific rules in addition to the general eligibility rules:

You can only use a residential loan for purchasing or constructing a primary residence, which may include any of the following:

You cannot use a residential loan for

Borrowing limits

Minimum loan amount

The minimum amount you can borrow is $1,000.

Maximum loan amount

The maximum amount you can borrow is the smallest of the following:

Note: If you have both a civilian account and a uniformed services account, the combined account balances and outstanding loan amounts will be used to calculate the maximum loan amount.

TSP account balances are recalculated at the end of each business day based on daily share prices. As a result, the maximum loan amount may change on a daily basis.

To find out more about the maximum amount available for a loan, use the calculator, Estimate Loan Payments , or contact us.

Loan costs

Direct costs

Loan Fee We charge a loan fee of $50 for administrative expenses. This fee is deducted from your loan proceeds. For example, if you request a loan for $1,000, the amount paid to you will be $950.

Interest The interest rate on your loan is the G Fund rate at the time your loan application is processed. This rate is fixed for the life of the loan. Although loan interest is not tax-deductible, all of the interest goes back into your TSP account.

Indirect costs

When you take a loan, you sacrifice the earnings that might have accrued on the borrowed money, had it remained in your TSP account.

Although you pay the loan amount back to your account with interest, the amount of interest paid may be less than what you might have earned if the money had remained in your TSP account. For information on all costs associated with a loan, review the booklet, Loans.