Cookflhx Posted October 16, 2017 Posted October 16, 2017 What is required proof to obtain a residential loan from 401K? If 10,000 is borrowed, but only $5,000 is used as a downpayment, is that acceptable? is proof needed to get the loan or only if you happen to be audited?
ETA Consulting LLC Posted October 16, 2017 Posted October 16, 2017 You should still be fine as long as the house is purchased withing a 'reasonable amount of time' and his valued at $10,000 or more. You're not securing the loan with the residence; so the amount of down payment is really not relevant. You also have the tracing rules in IRC Section 163(h)(3)(B) to tie the timing of the loan with the purchase of the house. Good Luck! CPC, QPA, QKA, TGPC, ERPA
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