Pros and Cons of using 401K funds for a down payment
One of the largest barriers to purchasing a home is the down payment and funds to cover closing costs and prepaid interest, insurance and taxes.
If you work for a company that offers a 401K that could be a viable option for borrowers to consider when purchasing a home, but there are pros and cons to using these funds, which are detailed in this article.
Some of the pros include the funds can be paid back over ten years, there are no credit checks, you can access the funds quickly and you’re paying yourself back at a decent interest rate. Other benefits include but are no limited to you become a home owner instead of a renter and you might be able to secure a lower rate and avoid PMI.
The biggest risk is job security.
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