Home Buying in 93535>Question Details

KB24_8, Home Buyer in Lancaster, CA

I have a 401K plan from my previous employer but no longer working for that company. My question is that I would like to take a loan against my 401K

Asked by KB24_8, Lancaster, CA Sun Jun 27, 2010

plan as to a new home buyer. It's my 401K so it would be a loan not a hardship loan for a down payment on a new house. How much can I take out? Is there any penalties? Thanks for all the help!

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Answers

4
If you no longer are employed by the company you can not take out a "LOAN" on your 401K

Loans made agaisnt 401K plans are repaid over time through payroll deductions. In fact, if you take out a loan on your 401 while employed , then quit the job the loan becomes due and paybale by you in full.


You may be able to do a "WITHDRAWL" from your 401 to buy a home, but before you do talk to your tax professional to make sure you do not run into trouble.

Best of Luck!
Kawain Payne, Realtor
0 votes Thank Flag Link Tue Feb 26, 2013
Depending on your plan penalties may apply--your best source of information is your tax professional and or plan administrator.
0 votes Thank Flag Link Sun Jun 27, 2010
Karen's right. I recommend calling your 401K company representative.

John J Mondello Jr, Realtor
Keller Williams
(225) 329-8119
"I find the house, you make it home."
0 votes Thank Flag Link Sun Jun 27, 2010
All plans are different. This isn't really a real estate question. You need to contact the manager of the plan. If you don't have their contact information, you will need to contact your previous employer.

This is a common way for buyers to get a down payment. Most plans do not require "hardship" for a loan. You will need to repay yourself with interest.

Best of Luck,

Karen Miller
(562)756-4144
0 votes Thank Flag Link Sun Jun 27, 2010
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