2006-11-05 10:41:03 · 5 answers · asked by Judith D 2 in Business & Finance ➔ Personal Finance
No, you will still get penalized.
2006-11-05 10:49:05 · answer #1 · answered by Mariposa 7 · 0⤊ 0⤋
You can withdraw from your 401(k) to purchase a primary residence, and you will avoid a penalty ONLY if you've exhausted all other means, including borrowing from the account.
So if you have the income to borrow now and make the house payment and the 401(k) repayment, then you probably will not be able to borrow.
Just because you might be able to do it does not mean its a good idea, however! You will still pay taxes on it, and you ARE going to have to retire someday.
Most financial advisors would consider this to be a big mistake. And, no, your situation is not unique - its exactly what they'd be talking about when they might say, "Bad idea, you will be worse off down the road and you will regret it."
2006-11-05 11:01:24 · answer #2 · answered by Jim S 5 · 0⤊ 0⤋
Depending on the bells and whistles written in to your companies plan, you may be able to borrow interest free from your 401k to purchase a primary residence. If that isn't written in, see if you can roll a portion, or all, of your 401k into an IRA while you're still employed (an in-service withdrawal). From there, you can take a penalty-free withdrawal to purchase a home.
You'll have to speak to someone in human resources to get the specifics regarding your plan.
2006-11-05 11:08:50 · answer #3 · answered by Anonymous · 0⤊ 0⤋
You can take a hardship withdrawl for a down payment, but the 10% penality is taken.
2006-11-05 10:51:05 · answer #4 · answered by Anonymous · 0⤊ 0⤋
No you cannot. In addition, you cannot take money out of a 401K plan unless you leave the company.
2016-05-22 02:07:09 · answer #5 · answered by Anonymous · 0⤊ 0⤋