TSP loan rules are set out in the loan note to the independent auditor’s report on the Thrift Savings Fund, and every term below was verified on 10 September 2026 against that document rather than against a summary of it. The audited accounts are more precise than most secondary coverage and they carry the default mechanics that matter most.
How much the loan volume actually is, and how much of it never gets repaid, is on the TSP loan tracker. This page is the rules.
How much can you borrow from your TSP?
Between $1,000 and $50,000, and the ceiling is statutory rather than a matter of what you have. The restriction people miss sits underneath it: loans may only be taken from participant contributions and attributable earnings.
Agency automatic and matching contributions, and everything those have earned, are not available to borrow against. A FERS employee with a large balance built substantially from the 5% agency contribution therefore has a smaller borrowing capacity than the account total suggests, and finds out at application rather than before.
Minimum loan
Maximum, from your contributions only
Fee, general purpose or residential
The 2 loan types
A general purpose loan can be obtained for any reason at all, with a repayment period from 1 to 5 years and a $50 fee deducted from the proceeds. A residential loan can only be used to purchase a primary residence, runs from 5 to 15 years, and carries a $100 fee.
Neither requires a credit check, because you are borrowing your own money, and neither appears on a credit report. That is genuinely useful for somebody whose credit would otherwise price them out of borrowing, and it is the strongest argument for the product.
If the reason for looking at a loan is a plan to move the balance elsewhere, what a custodian charges to hold it is the number that matters.
See which custodians take a TSPWhat a TSP loan charges
The rate is the G Fund rate from the month before the loan was requested, fixed at that level for the life of the loan. Interest earned on the loan is allocated back to your own account as payments are made, which is why the product is usually described as paying yourself.
The cost that description omits is what the borrowed money stops earning. Since 31 May 2003 the G Fund has compounded at 3.07% a year and the C Fund at 11.39%, so a borrower whose money came out of the C Fund gives up roughly 8.32 points a year on the borrowed amount for the whole term. After inflation the G Fund side of that returned 0.43% a year.
The default clock
This is the part the audited accounts describe more precisely than anywhere else, and it is the part that costs people money.
By IRS regulation the Agency must identify any participant loan in default each calendar quarter. The participant then has until the end of the following calendar quarter to pay the overdue amount. If it is not paid, a taxable distribution of the unpaid balance plus accrued interest is reported to the IRS and the loan is closed.
So the cure window is not a fixed number of days. A payment missed early in a quarter gives you nearly 6 months, and one missed at the end of a quarter gives you barely 3. Anyone who has fallen behind should be counting from the quarter boundary rather than from the missed payment.
What separation does to a loan
A taxable distribution also occurs when a participant separates from service and does not repay the loan in full or keep making payments. That single sentence in the accounts explains most of what shows up in the write-off figures each year.
In 2025 the plan reported $503 million of loan balances declared taxable, which was 4.66% of everything outstanding. Those are not people who could not afford a payment so much as people who left the payroll owing money, and the tax bill lands on top of whatever prompted the departure.
How many TSP loans are there?
The accounts do not publish a count, but they publish the fees, and the fees are fixed per loan. The plan collected $26.72 million in loan fees in 2025, at $50 for a general purpose loan and $100 for a residential one.
That puts the number of new loans between 267,200 and 534,400 for the year, the lower bound assuming every loan was residential and the upper assuming every one was general purpose. The true figure sits inside that range and closer to the top of it, since general purpose loans are far more common, but the accounts do not publish the split and we are not going to estimate one we cannot source.
If the balance is moving after the loan is settled
A loan has to be cleared before a rollover, so the mechanics are worth having in mind at the same time. A direct rollover sends the money from the plan straight to the receiving custodian with no tax withheld. An indirect rollover pays you first, withholding applies, and the full original amount has to be redeposited inside 60 days out of your own pocket.
In a self-directed IRA holding metal, the purity rules of section 408(m) decide what bullion qualifies, it has to sit at an approved depository rather than at home, and the custodian fee plus the storage fee commonly run several hundred dollars a year regardless of balance. The premium over spot on the first purchase sits on top of that and appears on no fee schedule.
Against a plan that charges a flat $50 to originate a loan and nothing to hold the balance, that is the comparison worth making with the numbers in front of you.
Once a loan is settled and a rollover is on the table, what the receiving account may hold is on TSP to gold IRA.
Our read
A TSP loan is cheaper than almost any consumer credit, invisible to a credit report and available without underwriting, and for a genuine short-term need those are real advantages that no rollover offers. What it is not is free, and the cost is the return the borrowed money stops earning rather than the interest rate on the paperwork.
The situation to avoid is the one that produces the write-off figures. Taking a loan and then leaving federal service, voluntarily or otherwise, converts a cheap loan into a taxable distribution with a possible penalty on top, and separation is exactly the moment people also start thinking about rollovers.