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fox__in_socks t1_ja8dast wrote

Reply to comment by No-Lunch4249 in Using my IRA as a down payment when I have a pension? by [deleted]

Would it be more advisable to put less than 20% down then? Seems like the longer we wait, the more housing costs keep going up.

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No-Lunch4249 t1_ja8ed3o wrote

Unfortunately no one has a crystal ball that can see the future of the housing market, as much as they may pretend to.

Your options are:

  1. Buy with less than 20% down, take PMI, and hope interest rates don’t keep going up, and refinance out of the PMI in a few years

  2. Enjoy your low-rent situation for a while longer, continue building that down payment fund, and hope prices don’t continue rising and that interest rates start going back down

  3. Do your original idea of emptying your IRAs, take the 10% penalty plus the additional tax burden, plus the opportunity cost of having significantly reduced your retirement investments, potentially pushing your retirement years further out.

I can’t tell you which one is right, personal finance is personal after all. But for me, I think the 3rd option is the one with the biggest downsides.

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