It's possible, in different ways:
- Withdraw money from the 401k. You will need to pay income tax and penalty if you're younger than 59 1/2 years old.
- You can take a loan if your plan allows 401k loan.
- If you can rollover the money into an IRA, you can withdraw up to $10,000 to purchase your first home without paying the 10% penalty, regardless of your age. (Income tax will still apply)
- If you can rollover the money into a self directed retirement account (self directed IRA, self directed Solo 401k, etc), then you can use the money to invest in the house, tax-free, penalty-free. However, you will not be able to live in the house yourself or benefit from it personally. You can only treat it as an investment.
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