No. of Recommendations: 2

To me the huge disadvantage of borrowing from a 401(k) is the fact that if you lose your job for any reason, you will promptly have to pay the money back or pay taxes & penalty on it.

Think about the fact that this will come at the lowest financial point of your life, and suddenly you have to come up with the entire loan amount. If you don't have a job the chances of borrowing the money somewhere else are remote. If you change jobs for a better position, many lenders will want a longer period of current employment for their best interest rates.

Even if you are 110% certain your job is secure, you never know when or if you could become disabled for a period.
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