# Buying a house with a 401(k)
**URL:** https://boards.straightdope.com/t/buying-a-house-with-a-401-k/424950
**Category:** Factual Questions
**Created:** [November 2, 2007, 12:20am UTC](https://boards.straightdope.com/t/buying-a-house-with-a-401-k/424950 "2007-11-02T00:20:16Z")
**Posts on this page:** 3
**Page:** 1
### Author:  [@Smeghead](https://boards.straightdope.com/u/Smeghead)
#### Post date: [November 2, 2007, 12:20am UTC](https://boards.straightdope.com/t/buying-a-house-with-a-401-k/424950/1 "2007-11-02T00:20:16Z")
I have heard that one of the few ways you can withdraw money from a 401(k) before retirement without having it be very heavily taxed is to use it to buy your first house. Is that true? If it matters, my wife and I actually have both 401(k) accounts and 403(b) (the equivalent for government workers) accounts, because a few years ago we were reclassified as government workers.
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### Author:  [@UltraVires](https://boards.straightdope.com/u/UltraVires)
#### Post date: [November 2, 2007, 12:22am UTC](https://boards.straightdope.com/t/buying-a-house-with-a-401-k/424950/2 "2007-11-02T00:22:04Z")
[QUOTE=Smeghead]
I have heard that one of the few ways you can withdraw money from a 401(k) before retirement without having it be very heavily taxed is to use it to buy your first house. Is that true? If it matters, my wife and I actually have both 401(k) accounts and 403(b) (the equivalent for government workers) accounts, because a few years ago we were reclassified as government workers.
[/QUOTE]
Yes, but the limit you can use is $10k without the PENALTY. You still get taxed on the income, and homes with the prices they have today require much more than $10k.
Above that you get hit with the taxes AND the penalties for early withdraw.
The feds at their finest. Fashion a rule that is inflexible and punishes home ownership..
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### Author:  [@Neptunian\_Slug](https://boards.straightdope.com/u/Neptunian_Slug)
#### Post date: [November 3, 2007, 2:42am UTC](https://boards.straightdope.com/t/buying-a-house-with-a-401-k/424950/3 "2007-11-03T02:42:54Z")
[QUOTE=Smeghead]
I have heard that one of the few ways you can withdraw money from a 401(k) before retirement without having it be very heavily taxed is to use it to buy your first house. Is that true? If it matters, my wife and I actually have both 401(k) accounts and 403(b) (the equivalent for government workers) accounts, because a few years ago we were reclassified as government workers.
[/QUOTE]
I actually took a loan form the 401K to buy my house. There are risks to that strategy. But I was reasonably confident that my bonus would cover it come January. So you can do it that way as well as long as you have a strategy to pay it back.