Buy with Cash from ROTH IRA - Refinance - Return Funds in 60-days

[Sunny Burns]

Has anyone done this?

My Wife and I have $140k in our Roth IRA's.

We came across a decent deal that is only taking cash offers.

Utilizing the once every 12-month, 60-day “Tax Free Rollover” we would withdraw all the funds (principal + gains) from our Roth’s (penalty free).

Buy the Home in 100% Cash with those funds.

Next day apply for a Mortgage (Already preapproved for a $350k loan).

Leave 20% equity from the house and take the 80% cash out to refund the Roth IRA.

What are the issues with doing this?

I can also leverage $50k from my 401k to make up any delta from the 80% "refinance" and initial Roth IRA cash withdrawal.

For more details on the 60-day withdrawal, below is what vanguard says:

Neither Roth nor traditional IRAs allow you to take loans, but you can access money from an IRA for a 60-day period through what's termed a "tax-free rollover" as long as you put the money back into the same or a different IRA within 60 days. Effective as early as January 1, 2015, you're limited to only one such "rollover" within a 12-month period, regardless of the number of IRAs you own.

https://investor.vanguard.com/ira/ira-distribution-rules