Use Roth IRA for down payment?

[Greg Ouellette]

I recently discovered that as long as it is used for the direct purchase of a home and the account is at least 5 years old you can use up to $10,000 (without taxes or penalties) of a Roth IRA to help buy real estate. I opened Roth about 3 years ago and I also have a 401k through my employer that I contribute 12% to. An extra $10,000 in a couple of years could help me avoid having to aquire PMI on my first real estate purchase. I’m planning on buying a multifamily residence, occupy one unit and rent the remaining and use the rent to pay the mortgage and other expenses, and if necessary the PMI. I’d like to hear peoples’ thoughts on whether it would be worth it to dip into my retirement to possibly avoid purchasing PMI.