IRA $10000 -- Downpay Investment Property then IRA First home Purchase

[Brandon Cao]

Hello Everyone,

I have heard a lot about using $10,000 of IRA money penalty-free on your first home purchase. I have an interesting question that hopefully one of you can answer. I am currently under an unbreakable lease renting for another 6 or 7 months and would like to invest in a rental property in Philadelphia (within the next month or two).

So I will be putting down 20% cash (not IRA) purchasing my first investment property before buying a first principal home. It has already been pre-approved by the lender. My question is, would i still be able to use the $10,000 IRA money on technically a second house purchase that would be my first principal residence, if I buy the principal residence 6 months from now [i.e. after the investment property]?

I hope the answer is yes, as I do have the resources to handle the investment property and the IRA withdrawal.