Can I use my 401K to buy a house?

FALLBROOK – Achieving homeownership is an aspiration for many Americans, yet it can pose considerable challenges. If you find yourself lacking funds for a down payment, one alternative is to utilize your 401(k) for the purchase of a house.

Yes, in certain situations, you can use your 401(k) to buy a house. The Internal Revenue Service (IRS) allows for penalty-free withdrawals from your 401(k) for a first-time home purchase. Here are some key points to consider:

First-time homebuyer exception

You can withdraw funds from your 401(k) without the usual 10% early withdrawal penalty if you are a fir...