Profile picture for jomoco16

Can I take out my 401 with no penalty as a hardship to pay off my home when I sell at reduced price?

I am 35 yrs. old
401 balance is $18k
Mortgage Amt. is $263k
Anticipated sale price is $249K
  • December 18 2008 - Lanoka Harbor
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Answers (3)

If you are in a hardship and wants to sell your home below what you owe, you may not need to get any money fron your 401. Call the mortgage holder first and explain your hardship and you may qualify for a shortsale with no contribution on your side. You may also employ a local Real estate agent to help dealing with the mortgage holder. Good Luck. 
  • June 22 2011
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Profile picture for coffebrk
This should be discussed with your human resource dept or pension advisor at your workplace. The withdrawal privileges of the account are written into the master agreement. The IRS allows a penalty free withdrawal from a qualified retirement plan for hardships and the purchase of a first home provided certain conditions are met. There are limits to the amounts that are penalty free.  A CPA specializing in tax law can also advise you.
  • December 19 2008
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Profile picture for broker_GRI
You should seek the advice of a CPA
  • December 18 2008
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