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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 127262  
Subject: Re: Downpayment Sources Date: 5/10/2013 1:34 PM
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Brewologist:

<<<However, are the 401K funds not considered borrowed? Won't the mortgage co have an issue with you borrowing down money? . . .>>>

"I questioned this as well, but my mortgage broker claims that a 401k loan is ok to use. Frankly, I was surprised."

When I bought my first property (decades ago), this was a true statement and I voided PMI by borrowing 80% with a mortgage and funding the 20% (plus closing costs) from cash and 401k loan for 10% of the purchase price.

Not sure whether those rules still hold (and before the naysayers start, that 401k plan did not require immediate repayment upon departure [regardless or whether involuntary or voluntary]).

Regards, JAFO
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