Updated about 9 years ago on . Most recent reply
401k loan for my down payment?
Hi everyone,
I am going to use my 401k to pay for my down payment, I would like to know if this method is fine? Thanks.
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#1 New Member Introductions Contributor
- Solo 401k Expert
- Anaheim Hills, CA
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#1 New Member Introductions Contributor
- Solo 401k Expert
- Anaheim Hills, CA
Rob, perhaps you misunderstood your plan's loan policy. Assuming that your plan allows participant loan (not all plans do) "Repayment of the loan must occur within 5 years, and payments must be made in substantially equal payments that include principal and interest and that are paid at least quarterly."
You are probably confusing the loan from a 401k to a 60-days indirect rollover from one IRA to another IRA.
See the following IRS link for reference about the loan from a 401k:
https://www.irs.gov/retirement-plans/retirement-pl...
Here is a reference for a 60-day rollover:
https://www.irs.gov/retirement-plans/plan-particip...
Hope this is helpful to you and other readers.