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I agree that taking a loan against a 401k is a terrible idea...... unless it's the substitute for a mortgage. Aren't I paying that loan back at a much lower rate (and paying back to myself) than a 30-year fixed APR?

To me it seems smarter to loan against the 401k money and put that money into my house, then pay the loan back over time... instead of giving that much more interest $ to the bank

not 'terrible' (IMO), but very risky.

don't know that the 401k rate would be lower than mortgage ( for me, it was lower than auto-loan rate .. i WAS wild-&-crazy <g> ),

but could be ..and you are paying yourself ..and the higher down could get you out of PMI
Could be smart ,depending on all the numbers.

the danger, as everyone notes is in losing your job -- you need a back up plan just in case.
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