Using Retirement Savings For A Real-Estate Down Payment

To fund a real estate down payment, although not advisable, it is possible to use retirement funds, even those in work-related retirement accounts.

While you cannot take money for a real estate down payment from a 401(k) or IRA account, you can, in certain circumstances, borrow money from these accounts for a real estate down payment. Rules for borrowing these funds vary from employer to employer, so it is necessary to check with your own employer to determine if your funds are eligible for borrowing.

On the federal side of things you are permitted to borrow from an IRA up to $10,000 penalty-free if the funds are going toward the financing of a new home.

Many experts recommend this option only as a last resort. However, if absolutely no other financing options are available to you, it remains a possible way to access additional funds.