I am currently looking at buying my first property. I am considering using my 401k to finance the down payment. Right now I have a lender that will allow me to put a 15% DP on a owner occupied proprty or 25% DP on an investment property.
401k loan = $25k
I have an additional $10k to invest/emergency/closing costs
Property is listed at $230k
Built in 1981
Rents are $1150 & $1050
Returns are over 7% for cash on cash with tenets in both sides
I only have enough cash for a 15% DP so I would have to occupy it for atleast a year, so only one side would rent.
Would you guys proceed with this deal? Why or why not?