Using 401(k) Funds to make a Down Payment on a Home in Phoenix Yes, you can use your 401(k) funds to make a down payment on a home. After all, it is your money and you can spend it as you see fit. Although it doesn’t work the same way as a standard deposit account, you have every right to access those funds if you decide to do so. For many individuals, their 401(k) is their largest type of financial account. So it can be very tempting to use those funds for making a down payment on a home loan. Just be aware that there are certain drawbacks to doing this such as penalties, potential repayment requirements, and taxes. The 401(k) was originally designed for retirement purposes and was meant to last into your “golden years.” Consequently, you shouldn’t just dip into it whenever you feel like it. Up until you reach 59½ years of age (55 if you aren’t working anymore), you’ll be charged a 10% penalty for early withdrawals on any of the funds you take out. Plus, you’ll be taxed on those funds as well. Typically, if a person decides to use these funds for making a down payment on a home, it’s because they’re first-time buyers who don’t have the assets or savings for a down payment. https://www.google.com/maps?cid=6744959272592205627