Should I cash-out 401(K) or let it grow?

[Marc Ferguson]

Hi, I have a 401(K) savings plan with a previous employer valued at under $50,000. I'm wondering if I should withdraw and hold the money in my brand new real estate investment bank account or if I should continue to let it grow until I need it for a downpayment on my next property? There are plenty of penalties if/when I withdraw it. I'm unclear at what point is it worth paying the taxes on the capital gains if I'm not immediately using it.

Word-on-the-street is having money in my bank account looks good to banks when I'm looking for a loan. Does it matter that the money is just sitting there or do they want to see some activity with that account? Thanks for any advice.