I borrowed the money to pay for the construction of my new home. I am in the third year of the 10 year loan. The loan was for $50,000.
2006-12-01 09:47:45 · 3 answers · asked by Stephen C 1 in Business & Finance ➔ Personal Finance
Generally yes, the loan would be called due. Which means they'd effectively liquidate that amount, and you would owe taxes and penalties on it.
I hope your new job pays a lot more than you get now. Otherwise it may not make sense to switch.
Any chance you could take out a home equity loan to pay it off? Hopefully that $50K you put into the house is now equity that can be borrowed against.
This is the one main danger of borrowing against a 401k, leaving and getting smacked with penalties and taxes if you can't find a way to pay it off right away.
2006-12-01 10:05:06 · answer #1 · answered by Anonymous · 0⤊ 0⤋
If you are planning on rolling over your 401K, then yes, the loan would have to be paid before the rollover. Why not look into mortgage loans before you make the big step and leave your job. Interest rates are really good, and since you already have 3 years equity in your home, lenders would be more inclined to consider you. Of course, you could leave your 401K, but it's your money, and it's open to abuse without you as an employee.
2006-12-01 09:52:46 · answer #2 · answered by Anonymous · 0⤊ 0⤋
yes or otherwise it will have tax implications
2006-12-01 09:51:13 · answer #3 · answered by george 2 6 · 0⤊ 0⤋