Posted on: 29th Aug, 2008 04:30 am
Hello, My comapny requires 401kloan first and then a hardship withdrawal. I was preapproved two weeks ago and i have found a house. I am worried that another paycheck stub will be requested that will show the loan. I have applied for harship withdrawal (So it would not count as a debt) However, I am worried about the timeline. I don't want this to be a deal breaker. Any advice?
Hello.
You are taking a loan from your Retirement Fund. Do you know if you don't pay off the loan, then it will be considered as an early distribution from the account and you will have to pay federal and state income taxes on that amount.
You are taking a loan from your Retirement Fund. Do you know if you don't pay off the loan, then it will be considered as an early distribution from the account and you will have to pay federal and state income taxes on that amount.
Hi deblez,
Welcome to our forums.
I think you're worried over the fact that a hardship withdrawal may lead to problems in your home-buying process? Are you concerned about the time gap between taking a hardship withdrawal and applying for a mortgage? If you can elaborate your situation it'll be very helpful for me to give you a concrete suggestion.
Good luck
Welcome to our forums.
I think you're worried over the fact that a hardship withdrawal may lead to problems in your home-buying process? Are you concerned about the time gap between taking a hardship withdrawal and applying for a mortgage? If you can elaborate your situation it'll be very helpful for me to give you a concrete suggestion.
Good luck
Thanks for your response
At this time I have a 401k loan. This loan payment increase my debt/income ratio. I was pre approved without the loan being a part of my debt. If a more recent paystub is requested then the loan repayment will show up an count as a debt. I have applied for the a hardship withdrawal but the process takes 30 days. I put an offer on the house and i don't want to to lose my financing over this debt. so please advise if possible,
thanks so much
At this time I have a 401k loan. This loan payment increase my debt/income ratio. I was pre approved without the loan being a part of my debt. If a more recent paystub is requested then the loan repayment will show up an count as a debt. I have applied for the a hardship withdrawal but the process takes 30 days. I put an offer on the house and i don't want to to lose my financing over this debt. so please advise if possible,
thanks so much
Hi deb,
It seems that you logged out while posting. Anyway, I do understand that the debt to income ratio (DTI) was calculated without including the 401k loan. But does the lender know that you've already taken a 401k loan?
Since you've just been pre-approved and the loan process is yet to start off, therefore, there are chances that the lender may recalculate the DTI. But it's better to have a straight talk with the lender regarding this.
Take care
It seems that you logged out while posting. Anyway, I do understand that the debt to income ratio (DTI) was calculated without including the 401k loan. But does the lender know that you've already taken a 401k loan?
Since you've just been pre-approved and the loan process is yet to start off, therefore, there are chances that the lender may recalculate the DTI. But it's better to have a straight talk with the lender regarding this.
Take care