When the TSP pays out your loan, it will notify your payroll office immediately to begin deducting loan payments from your salary each pay period.
Check your leave and earnings statement to be sure that loan payments have started and that they are in the correct amount. Contact your agency or service if payments have not started or if they are in the wrong amount.
Be aware that you are responsible for the repayment of your loan regardless of whether your agency or service misses a payment. For more information, visit Missed Payments.
When you repay your loan, you repay it with interest (visit Loan Costs). The repayment amount gets deposited back into your TSP account and is invested according to your most recent contribution allocation.
Daily interest on your loan is calculated as each payment is posted and is based on the number of days since the last loan payment and the outstanding loan balance.
You can make extra loan payments (in addition to your payroll deduction) at any time using a personal check, cashier's check, or money order. You must send Form TSP-26, Loan Payment Coupon with your extra payments.
If you use an online banking service to make extra loan payments, be sure to refer to the Loan Payment Coupon to ensure that the information it requires gets included on your bank check. If any information is missing, the check will be returned.
You are responsible for ensuring that the correct loan payments are submitted on time regardless of whether your agency or service missed your loan payment.
Making up Missed Payments At the end of each calendar quarter, the TSP identifies all loans with missed payments. If you have missed more than 2½ payments, the TSP will send a notice indicating that you have until the end of the following calendar quarter to pay the missed amount. You must pay the missed amount directly to the TSP using your own personal funds to avoid a taxable distribution. Your payroll office cannot make up missed payments from your pay.
The TSP will report your loan transactions on your quarterly participant statement. Review this information carefully and be sure to report any discrepancies to your agency or service.
You can also track your loan balance and the status of your payments in the My Account: TSP Loans section on the TSP website.