Best way to use 401k to finance a property

[Ali Hashemi]

I own a fully leased 8 unit multi-family and am looking to purchase a 12+ multi-family in 2018. I estimate in my geography I can find what I'm looking for for around $750,000 or less.

My bank is hard and fast on requiring 20% down-payment. And I figure I'll need an additional $10k for 'transition/closing costs'.

20% of $760,000 is $150,000.

I currently have $25k in my Roth IRA and $100k in my 401k and will soon have (if I stay on track) the remaining $25k in savings.

Selling my 8-unit is not an option (not enough equity). Finding private financing is always an option, but unlikely (I don't know many people with that kind of money to spare). So leveraging my Roth IRA and 401k seem to be my most feasible option.

What is the best way to do this:

1) Cash out my 401k (worry about tax penalty in 2019)

2) Borrow against my 401k?

3) Can I 1031 exchange my 401k?

4) Some other option?

I appreciate any advice/insight/recommendations....