[quote=EmilyHicks]I have around $45,000 in my 401K and my husband has around $30,000. Can I withdraw some of this money at no penalty? We have no money in IRA. I have looked at houses in the $350,000 range but most are too old or in bad neighborhoods.[/quote]
You can usually (depending on plan administrator) take a loan against some portion of your vested 401K account (most cases I believe it’s 50%). It must be repaid, with interest (but at least the interest is going to yourself, so that’s not a big deal) over the loan period (I think mine allows 15 years for a loan taken out for a primary residence purchase).
There’s a caveat to this – if your 401K is through work, and you lose your job, you may be required to payback that loan in an accelerated manner (60-90 days). If you do not, it is treated as a withdrawal and you will be subject to large tax penalties.
