IRA/ 401K funds for mortgage

[David S]

Should people be allowed to borrow money from their IRA or 401K plans to use for their mortgage? It would work like this:
As a homeowner you would still have a mortgage but you would owe the money to your IRA instead of the bank. Instead of making payments to the bank you would pay them to your IRA account.

As an IRA investor you would have an interest bearing investment in your IRA similar to a land contract. The interest rate would be whatever your mortgage rate is, maybe 5 or 6 percent in today's market.

Considering the volatility of the stock market this would give you a more stable place to invest your savings.  5 or 6 percent doesn't sound too bad today. It would be as secure as your determination to pay off the mortgage.

(This is currently allowed in some 401K plans but usually there are so many strings attached that it becomes impractical)

[Smash255]

Should people be allowed to borrow money from their IRA or 401K plans to use for their mortgage? It would work like this:
As a homeowner you would still have a mortgage but you would owe the money to your IRA instead of the bank. Instead of making payments to the bank you would pay them to your IRA account.

As an IRA investor you would have an interest bearing investment in your IRA similar to a land contract. The interest rate would be whatever your mortgage rate is, maybe 5 or 6 percent in today's market.

Considering the volatility of the stock market this would give you a more stable place to invest your savings.  5 or 6 percent doesn't sound too bad today. It would be as secure as your determination to pay off the mortgage.

(This is currently allowed in some 401K plans but usually there are so many strings attached that it becomes impractical)

As someone who is a mortgage broker I would say no

[David S]

Should people be allowed to borrow money from their IRA or 401K plans to use for their mortgage? It would work like this:
As a homeowner you would still have a mortgage but you would owe the money to your IRA instead of the bank. Instead of making payments to the bank you would pay them to your IRA account.

As an IRA investor you would have an interest bearing investment in your IRA similar to a land contract. The interest rate would be whatever your mortgage rate is, maybe 5 or 6 percent in today's market.

Considering the volatility of the stock market this would give you a more stable place to invest your savings.  5 or 6 percent doesn't sound too bad today. It would be as secure as your determination to pay off the mortgage.

(This is currently allowed in some 401K plans but usually there are so many strings attached that it becomes impractical)

As someone who is a mortgage broker I would say no

Aside from the fact that it would reduce your business, would you support it?