Should I cash out my 401K to buy my first home?

Houses in my area are very cheap now I just looked at a really nice foreclosure for $40,000! My job is very secure. People keep saying now is also the time to buy stocks but I just don't have any confidence in the financial sector anymore. I keep thinking it took 25 years for most people that lost their... show more Houses in my area are very cheap now I just looked at a really nice foreclosure for $40,000! My job is very secure.

People keep saying now is also the time to buy stocks but I just don't have any confidence in the financial sector anymore. I keep thinking it took 25 years for most people that lost their investments in the 1929 stock market crash to get their money back. Also my mortgage will be less then my rent. I think with all the thievery that's going on real estate may be the safest investment because your house just can't disappear.

The stimulus also includes a $7500 tax credit for all first time home buyers.
5 answers 5