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    sandrajeminson6's Avatar
    sandrajeminson6 Posts: 1, Reputation: 1
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    #1

    Apr 6, 2016, 06:35 AM
    401k withdrawal home purchase
    How do I take out a loan from my 401k to purchase a home at my age 54
    ma0641's Avatar
    ma0641 Posts: 15,675, Reputation: 1012
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    #2

    Apr 6, 2016, 12:42 PM
    You talk to the plan administrator. However, at age 54 you will have to show "hardship" Check this link for more detail.

    How to Purchase a Home Using a 401k | eHow
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #3

    Apr 11, 2016, 11:10 AM
    You may take a withdrawal from your 401(k) to assist you in financing the purchase of a principal residence - this is a well-defined "hardship" that your plan must allow. However, just because it's called a "hardship" does not mean it avoids the 10% early withdrawal penalty, plus you will have to pay income taxes on the amount withdrawn. So it's a pretty bad deal. A better option, if your plan allows it, is to borrow the money from your 401(k) account. This avoids the 10% penalty and taxes, and since you are taking a loan from yourself you will be paying yourself back. If you must use some of your 401(k) assets to help with the home purchase, talk to your plan administrator about this option.

    Another option: if you have an IRA you can use up to $10K for a first-time home purchase without penalty (though income taxes may be due). The IRS defines a "first time home buyer" as someone who does not have ownership interest in a main home for at least two years.
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