<prompt> Human: My wife and I are thinking of buying a bigger home and my company offers a 401k loan. We can borrow up to 50000 with a 5.25 interest rate, payable in up to 5 years. They will deduct the payment from each paycheck. If we combine this with the profit we make from our current residence, we can purchase a much larger home for our family of 5. Is this a good option for us?  <response>: 401k loans are really a bad idea unless you are really stuck. You are paying them back with after tax money, which completely nullifies the whole point of a 401k to begin with. 