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tomsen12 OP t1_jadltef wrote

Reply to comment by goblueM in How much 401k loan should I take? by tomsen12

Does the fact that I can’t put 20% down increases the lending interest rates? This is a conventional loan.

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goblueM t1_jadmc2d wrote

it can. depends on the lender and the specifics of the loan

still likely to be better than raiding your 401k

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innkeeper_77 t1_jae7dlh wrote

A 401k loan is somewhat better than actually “raiding” it but if the market recovers while the loan is out that is obviously a terrible idea.

If OP could pay it back very quickly it wouldn’t automatically be a terrible idea especially if they can get a better interest rate that way.

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goblueM t1_jaea9ka wrote

Yes this is not cashing out, but I'm always hesitant to suggest a 401k loan because IMO it encourages bad behavior. If you can't afford the stuff without taking a loan out of your retirement...you can't afford it

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