401k and real estate loans

Discussion in 'UPS Retirement Topics' started by plkl62, Nov 19, 2015.

  1. plkl62

    plkl62 New Member

    Can anyone tell me if I am a participant in the teamsters 401k if I would like to take out a loan for a down payment on a property what are the restrictions on the loan how soon does it have to be paid back?
     
  2. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    Loans from your 401k are made with money from your account.
     
  3. upschuck

    upschuck Avatar bet gone wrong

    The restrictions are that it would have to used for down payment on your property. Just be cognizant that if you leave UPS, then you'd have to pay back that loan, immediately I think, or pay taxes and penalties, which are hefty.
     
  4. You have 90 days to pay it back after you leave employment. Otherwise it's considered a withdrawal with taxes and penalties due
     
  5. retiredTxfeeder

    retiredTxfeeder cap'n crunch

    They have a list of things that are eligible to withdraw money from your 401k for. Ours is more restricted than most. My wife's 401k is a lot more flexible. She can borrow money for any reason.
     
  6. You are correct. It UPS rules,not the IRS.
     
  7. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    I agree with the tighter rules. 401k's should not be thought of as "piggy banks".
     
  8. I'd you got to borrow the down payment, you can't afford the house.
     
  9. plkl62

    plkl62 New Member

    How long if I do stay employed which I hope to
     
  10. After you qualify
     
  11. brownmonster

    brownmonster Man of Great Wisdom

    Before you can borrow from your 401k you have to put money into it. You borrow your own money. Sounds like you aren't even signed up yet. Good luck with that.
     
  12. Areyoukiddinme

    Areyoukiddinme best 2 weeks ever

    there are many restrictions, go online to your account and check them
     
  13. Brownslave688

    Brownslave688 You want a toe? I can get you a toe.

    A 401k is not a savings account. Start a savings account with auto withdrawals into it if you want.
     
  14. By The Book

    By The Book Well-Known Member

    You have to have an account with a balance in it. An example may be you have 100,000.00 in it and need 25,000.00 for a primary residence. You may qualify and the loan may be structured as a 5,10 or 15 year term. The monies come out of your checks until paid back.
     
  15. By The Book

    By The Book Well-Known Member

    I have heard of some who borrow enough to cover the 20% down to avoid the MIP. To me this is smart to pay yourself back instead of extra fees on the loan.
     
  16. Brownslave688

    Brownslave688 You want a toe? I can get you a toe.

    Not worth losing all of that extra growth.
     
  17. By The Book

    By The Book Well-Known Member

    I guess it depends on how good the deal was, or the amount borrowed.
     
  18. You do have a good point but. Unless it's a deal of a lifetime I wouldn't touch the 401k. If you can't afford the down payment that means you don't have any money in an emergency fund. If something needs repaired or replaced ,then what?
     
  19. By The Book

    By The Book Well-Known Member

    Good points.