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Would borrowing from my 401K be an acceptable way to come up with a down payment?

by maarit174 from Yorkshire, New York. May 20th 2016 Reply


Lorne Harvey (lorneharvey)
#80 ranked lender in Washington - 431 contributions

Absolutely, this is very common. The re-payment of this type of secured loan is not even counted in your debt to income ratios.

May 20th 2016
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William J Acres (William_Acres)
#73 ranked lender in Arizona - 8,722 contributions

Yes. it is.. your lender will need to paper trail the funds coming out of your account and into your checking account.. they will also need copies of terms of withdrawal form your 401K administrator.. Keep in mind that it is always best to "Borrow" your own funds against a 401K rather than doing a distribution.. this way you will not have a tax obligation.. or penalty.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com NMLS# 226347

May 20th 2016
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Robert Reid (reid@gardencitymortgage.com)
#155 ranked lender in New York - 4 contributions

Yes. What you will need to do is show the lender under what conditions money can be withdrawn from the 401K plan. The plan administrator should be able to provide you with the documentation for the plans guidelines regarding withdrawals.

May 20th 2016
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Robert Reid (reid@gardencitymortgage.com)
#155 ranked lender in New York - 4 contributions

Yes you can borrow from your 401K plan for the down payment, however you will need to provide the lender with the plans guidelines regarding withdrawals from the plan. The guidelines can be obtained from the plans administrator.

May 20th 2016
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Nicholas Santarelli (info@mortgagecorp.com)
#156 ranked lender in New York - 2 contributions

Yes. Would you like more information about down payments and programs ?

May 20th 2016
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Nicholas Santarelli (info@mortgagecorp.com)
#156 ranked lender in New York - 2 contributions

Yes. It is one way. Would you like more information about down payments and the programs that coincide with them?

May 20th 2016
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Michael Garza (michael.garza@rate.com)
#251 ranked lender in Texas - 21 contributions

Yes it it. I would review your 401k Servicer's terms of withdrawal to review your penalty and withdrawal options. Some allow you to take a loan against your 401k vs a 401k withdrawal which have different tax implications.

May 24th 2016
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