I want to by a house but i have 23000.00 dollars in debt. i want to take half of my 401k and put it my part time job salarie. to pay my bills for one year. then take my full time job salarie to pay down my debt in one year. sound good?
2006-12-26 23:46:41 · 4 answers · asked by upickmeaname 1 in Business & Finance ➔ Personal Finance
you are going to need a down payment and closing costs for the house also. pulling money from your 401k will cost you in taxes. I suggest a budget where you can see if you can afford the house payment and to help pay off your debts. paying off your credit cards would be my first step
2006-12-27 00:13:10 · answer #1 · answered by shawn w 2 · 0⤊ 0⤋
Sounds bad. Yes, you can take money from 401k to purchase a house, but it's a loan and you have to pay it back and you're also charged taxes on it as well - if I remember correctly.
You want a house, good for you. Pay down your debt and then buy a house. You can't have everything you want when you want it. Besides, you'll need down payment and closing costs as well.
2006-12-27 00:58:47 · answer #2 · answered by parsonsel 6 · 0⤊ 0⤋
With housing prices plateauing or falling, there is no rush to buy a house. I would recommend figuring out how much more it will cost you to buy a house vs. your current rent.
Then take that amount and put it towards your debt. Once you have your debt paid off and you have enough for a downpayment, it is time to start the home shopping process.
It also depends on what kind of debt you have. If it is car loans and student loans with low payements and rates, then you are probably closer to being ready to buy a house. However you should have your credit card debt paid off before buying a house.
2006-12-27 01:47:44 · answer #3 · answered by VATreasures 6 · 0⤊ 0⤋
borrow against your 401k so you dont have to pay taxes or giveup your retirement.
2006-12-27 09:46:40 · answer #4 · answered by Anonymous · 0⤊ 0⤋