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I remember seeing something about making withdrawls from a 401K for 'emergency purposes'. Is this different from the mechanism for borrowing from your 401K (which you pay back)?

Yes, they are different. If you meet one of the specific "hardship" criteria, you can withdraw funds from your 401k. (Some employers also allow partial in-service withdrawals without a hardship.) If you spend the money, it'll be taxed and penalized (unless you are paying medical bills).

What if you have large portions of 401K rolled over to institutions like e-Trade?

Do you mean "Rolled over into an IRA"? Sorry, you can not borrow from or against an IRA.

Good Luck,

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