Ask Terry Questions Best borrowing option

Best borrowing option

By Terry Savage on July 10, 2015 | Housing / Real Estate

I have inherited property that I would like to turn into a vacation rental home. It needs upgrading. Is it best to borrow from my 401K, withdraw from my ROTH or borrow against the property?

Terry Says:  Well, you don’t want to borrow from your 40l(k) and lose all that future tax-deferred growth.  And similarly it’s a shame to withdraw from your Roth.  And it will be tough to get a loan against a vacation property.  Whatever happened to “saving up” for the project??  You don’t want to let this windfall turn into a huge liability.



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