Posted on: 14th Sep, 2010 04:59 pm
We bought a home in for $630 and is now valued at $400. We put down over 20%. I think we owe $475. We also have a HELOC loan that we owe $25k and we also have credit debt and $9800 left on our car.
We have not missed any payments but we aren't getting ahead at all. We've thought about getting into our 401k to pay off the credit debt. Pros and Cons of that? We are hoping of we can bring down the debt of the HELOC and credit cards that our bank would be willing to work with us.
Does anyone have any advice as to what we should do? Is there anymore information that you would need?
We have not missed any payments but we aren't getting ahead at all. We've thought about getting into our 401k to pay off the credit debt. Pros and Cons of that? We are hoping of we can bring down the debt of the HELOC and credit cards that our bank would be willing to work with us.
Does anyone have any advice as to what we should do? Is there anymore information that you would need?
Hi Renee,
Before going for 401K cash out, I think you should consider 401K loan option in order to minimize the debt.Some of the great features of 401K loans are.
1.Minimal interest rates: they offer much cheaper rates than any other bank can offer.
2.No credit check : No credit check because you are taking loan from your own account.
3.Instant cash: no approval is required for it and the cash is instantly paid.
Some of the disadvantages of the 401K loans are as follows,
1.You need to pay the installments regularly otherwise loan will be considered as early 401k withdrawal and you may have to pay the early withdrawal fee as well as taxes associated with it.
I will personally advice you to go for the 401 K loan option instead of withdrawing funds directly from 401K .
feel free to ask any further query if you have.
DIPA
Before going for 401K cash out, I think you should consider 401K loan option in order to minimize the debt.Some of the great features of 401K loans are.
1.Minimal interest rates: they offer much cheaper rates than any other bank can offer.
2.No credit check : No credit check because you are taking loan from your own account.
3.Instant cash: no approval is required for it and the cash is instantly paid.
Some of the disadvantages of the 401K loans are as follows,
1.You need to pay the installments regularly otherwise loan will be considered as early 401k withdrawal and you may have to pay the early withdrawal fee as well as taxes associated with it.
I will personally advice you to go for the 401 K loan option instead of withdrawing funds directly from 401K .
feel free to ask any further query if you have.
DIPA