Should I try to use 401k, 403b money to buy a 2nd House?

[SDGuy]

Microman wrote:
Question: is this a stupid idea?

Yes.

On a somewhat related note - to purchase additional real estate, I've always done cash-out refinancings (assuming you have equity in your residence). With current interest rates right around 5%, this is nearly free money (figure tax benefit will be about 1/3 of that, and an inflation rate of 3%). Even if the new rental property comes out to have a zero cash flow (expenses = income), the deductible tax benefits (mostly mortgage interest and property taxes) as well as depreciation will make your overall cash flow positive. A few things to keep in mind, though - only get fixed rate mortgages, don't max out your primary residence mortgage, and only buy property in a good location (low crime, attractive to potential tenants because of nearby amenities/commute, whatever local factors apply to your area). Owning rental property is not something to be taken lightly.