Isn't there any kind of law that states my investment company who holds my 401K to make them release funds to me with no questions asked? I'm in serious debt and taking out a large amount is the only way out of this problem. I have totally exasperated all possible resources and this is the ONLY thing left. I tried to get funds released to me today and they won't do it unless I have a letter from my mortgage company saying they're going to forclose on me. If they would give me enough to pay off my OTHER bills, I wouldn't be late with the mortgage anymore. Is there anything I can do to MAKE them give me what I need from the account? I already have a loan out on it and am paying it back with weekly deductions from my pay check, but I reallly need more than what they are allowing me. Any help? Thanks. Desperate in Pennsylvania.

As long as you are employed at the company where your 401(k) plan is located, the rules for allowing withdrawals depend upon the rules as established by your employer. Most plans do not allow in-service withdrawals, except for reasons of "hardship" as defined by law. Those hardship cases include:

1. Un-reimbursed medical expenses for you, your spouse, or dependents.
2. Purchase of an employee's principal residence.
3. Payment of college tuition and related educational fees and expense such as room and board for the next 12 months for you, your spouse, dependents, or children who are no longer dependents.
4. Payments necessary to prevent eviction of you from your home, or foreclosure on the mortgage of your principal residence.
5. Funeral expenses
6. Repair of a primary residence.

Your plan administrator is asking you to show that if you make a withdrawal the money will be used for one of these purposes, in accordance with the rules your employer establshed. Unfortunately, "serious debt" does not qualify as a hardship case. I hate to say this, but the only way you can make a withdrawal outside of these hardship cases is to leave the company - then you would able to withdraw the money, or roll it to an IRA and withdraw it from there.

In any event keep in mind that if you did make a withdrawal you will owe regular income tax plus the 10% early withdrawal penalty (if you are under 59-1/2 years of age).