2007-02-25 04:38:10 · 7 answers · asked by Calvin 1 in Business & Finance ➔ Personal Finance
If your plan allows loans or hardship withdrawals then you can use it to purchase a new home. Better not to though...If you buy a home with 100% financing then you will still have that home paid off in 30 years (hopefully). And if you sell it before then the fact that you didn't put anything down makes the appreciation all the better (ie 100% leveraged profit). Better to shop around and see if there are places where you can get 100% financed on a loan with no PMI. If you can't...do an 80/20. Then as soon as the house appreciates enough...refinance to get out from under the PMI. That PMI is the ONLY reason you'd need a down payment....your credit rating will have a larger impact on the loan rate then your down payment.
Remember this too...for every 10k you take out of yoru 401k you are costing yourself 125k from your retirement. Your house will NOT appreciate that much.
2007-02-25 06:41:42 · answer #1 · answered by digdowndeepnseattle 6 · 0⤊ 0⤋
i'm happy you like the residing house, and desire you saved the countless 401K money for taxes, or had lots withheld. you will pay earnings tax on the full volume of the withdrawal. That relies upon on your tax bracket, yet i might guess it rather is a minimum of 25% with the 401K money lined, or much extra - so which you will owe $25,000 or extra in earnings tax - must be as much as $33K yet probable no longer as properly, in case you're below age fifty 9-a million/2, you will pay a ten% penalty, so because it rather is yet another $10k S0 the tax you will owe is probable around $35-38k for the withdrawal, probable extra. something withheld while to procure the money for earnings tax will stick to to that.
2016-11-25 22:26:11 · answer #2 · answered by boyter 4 · 0⤊ 0⤋
You can borrow from your 401k to make the purchase.
2007-02-25 04:43:24 · answer #3 · answered by Baked n Blended 5 · 0⤊ 0⤋
It depends on how the plan is set up by the employer but sometimes yes.
Though its a BAD IDEA. Even if you have to pay it back to your self with interest it's still a bad idea. You will be losing far more money then you will ever be gaining in buying a house.
Save the old fashioned way. Start with a high interest savings like this one from www.emigrantdirect.com at 5.05%
2007-02-25 04:53:02 · answer #4 · answered by hogie0101 4 · 0⤊ 1⤋
Yes you can use your 401k to put a down payment or just use it as an asset.
2007-02-25 04:52:23 · answer #5 · answered by TP2001 2 · 0⤊ 0⤋
Yes, but then you will pay taxes on the amount you take out which was formerly tax deductable. This is a good site for mortgage info. on a new home. Good luck! http://loan.divinfo.com/
2007-02-25 04:55:49 · answer #6 · answered by Reenie 3 · 0⤊ 0⤋
yes you can purchase your new dream house
2007-02-26 00:43:41 · answer #7 · answered by Anonymous · 0⤊ 0⤋