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Regular Contributor
Posts: 118
Registered: ‎08-13-2012
0

IRA withdrawal for down payment

Part of our downpayment will be coming from my IRA. Withdrawals take about two weeks to get processed and receive the money. Should I go ahead and make the withdrawal request now even though the loan has not been officially approved yet? Our file is still with the mortgage broker and has not gone to underwriting yet. Our closing date is scheduled for October 26th.

Starting scores 2/27/12 TU 605 EX 576 EQ 560
Current scores lender pull 9/6/12 TU 663 EX 629 EQ 645
Closed on our first home 10/26/2012!
Regular Contributor
Posts: 226
Registered: ‎05-24-2012
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Re: IRA withdrawal for down payment

I would just to be safe and isure the money is in your hands. Worst case you can pay it right back should something fall through. I assume your LO knows you are doing this withdrawl?

Regular Contributor
Posts: 118
Registered: ‎08-13-2012
0

Re: IRA withdrawal for down payment

Yes, he knows.

Starting scores 2/27/12 TU 605 EX 576 EQ 560
Current scores lender pull 9/6/12 TU 663 EX 629 EQ 645
Closed on our first home 10/26/2012!
Regular Contributor
Posts: 233
Registered: ‎08-05-2010
0

Re: IRA withdrawal for down payment

Probably  better soon than later--lots of paperwork!

 

 You're lucky, my 401K plan only allows hardship withrawals after exhausing possible loans, so I will/would have to take a loan from mine, which would have to be paid back in full immediately should I change jobs.

Regular Contributor
Posts: 118
Registered: ‎08-13-2012
0

Re: IRA withdrawal for down payment

One of the many benefits of working for a small company. SEP-IRA means you can withdraw for anything at any time with a 10% penalty from the IRS for early withdrawal. Fortunately for us, the IRS waives that 10% penalty if you use the money to purchase your first home.

 

You probably didn't want to know that. Sorry, that is the CPA coming out in me.

Starting scores 2/27/12 TU 605 EX 576 EQ 560
Current scores lender pull 9/6/12 TU 663 EX 629 EQ 645
Closed on our first home 10/26/2012!
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Regular Contributor
Posts: 233
Registered: ‎08-05-2010
0

Re: IRA withdrawal for down payment

I work for a small company, too, but that's not how ours works.  bummer, too!

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