This is a great question that comes up a lot, especially when people are trying to buy in pricier areas like Ballantyne or Weddington and need extra cash for the down payment or closing costs. The short answer is yes, you can, but let's talk about whether you should. First, the rules: If you're a first-time homebuyer (haven't owned a home in the past two years), you can withdraw up to $10,000 from a traditional IRA for a home purchase without paying the usual 10% early withdrawal penalty. You'll still pay regular income tax on it though

With a Roth IRA, you can always withdraw your contributions penalty-free, and if you've had the account for at least five years, you can also take up to $10,000 of earnings penalty-free for a first home. For 401k plans, many employers allow hardship withdrawals for home purchases, but you'll typically pay taxes plus that 10% penalty. Here's where it gets tricky in our Charlotte metro market. Let's say you're looking at a $350K home in Fort Mill and need $70K total for down payment and closing costs, but you only have $50K saved

That extra $10K from your IRA might seem like the perfect solution. But remember, you're robbing your future self. That $10K could be worth $50K+ by the time you retire, thanks to compound growth. Plus, if you take it from a traditional IRA, you might bump yourself into a higher tax bracket for that year. My advice? Explore other options first. Maybe look at homes in Indian Land or other areas where prices might be a bit more manageable. Consider putting down less money (like 5% instead of 20%) and paying PMI for a few years

Look into first-time buyer programs in Mecklenburg and Union counties that might help with down payment assistance. If you absolutely must tap retirement savings, keep it minimal and have a plan to rebuild that account quickly. Your Fort Mill dream home is important, but so is not eating cat food when you're 75.