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Aaron Gomez
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Should I borrow from 401k to purchase Bay Area home?

Aaron Gomez
Posted Mar 22 2019, 21:17

I have a sizeable 401k but my Bay Area rent is putting a damper on my ability to save quickly. I'd like to buy here and potentially house hack, but it seems as if I'll be saving for years if I rely on only my savings, whereas I could use my 401k to get over that huge hurdle. It really feels like the down payment is the barrier to entry, not the monthly payments.

Nothing is 100% sure, but it seems most likely that the stock market (and thus 401k) will take a sizeable dip soon whereas SF real estate will be minimally impacted - therefore this problem will be drawn out for many more years if I don't act soon.

For someone who is very financially stable but simply unable to get past that barrier to entry - is it a good idea to borrow from one's 401k to get into the market? 

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