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Incurring New Debt

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bjthurston Joined: 04 Jun 2010 Posts: 1 1.00 Dollars($)	Posted: Fri Jun 04, 2010 11:20 pm    Post subject: Incurring New Debt Like 0 Dislike 0 Does borrowing money from your own 401K to purchase a car count as incurring new debt? What are the consequences of not obtaining court approval to incur debt?
jerry Moderator Joined: 17 Oct 2005 Posts: 2708 Location: MICHIGAN 429.63 Dollars($)	Posted: Sat Jun 05, 2010 3:06 am    Post subject: Like 0 Dislike 0 Hi bjthurston, As far as I know, most of the lenders will count the money taken from your 401k as a debt. You can take money out of your 401k and do not need the permission of the court for that. However, if you withdraw the money from your 401k account before the age of 59 and 1/2 years, then you would be liable for taxes. Thanks, Jerry

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