401k lost opportunity VS Real Estate returns

[Steven Torrez]

Hello,

I have a 401k with 30k in it. I can take a loan out from it for 15k for 5-10 years. The interest rate is 3.5% which gets paid back into my account. So the question is, should I take out the loan on my 401K to help with the down payment on my first house so I can potentially avoid the PMI. Seems the PMI would be as much as my 401k loan payment.

Also, do you think that you can earn better returns on your money in buy and hold deals than the same amount of money in your 401k would earn you?

Im not saying I want to stop my 401k, just that I want to use it for my first house to get the ball rolling so to speak. I'd still be investing in my 401k as I don't want all my eggs in the real estate basket.

[Bryan Drury]

@Steven Torrez, Comparing your 401k returns with real estate returns may be like comparing apples to oranges. 401k returns are very passive with little input from you.Real estate returns can be alot better or worse depending on your strategy,talent,leverage, and level of involvement.REI can also be as active or passive as you want.As for your question about borrowing from it to get started and avoiding PMI costs, that makes total sense to me.Last year I converted my 401K to a self directed Solo 401K, and it has worked out very well. Good luck.