Can I use my 401K to buy a house... (if so should I?)?

Hi Brent, you certainly can and a great lender can advise best on how to go about. They would need to look at your situation specifically and advise appropriately. If you can save up a down payment without doing so would be preferred, though it can help you get in a home and start building equity. Each are good investments if you ask me. You may be surprised by some of the lending options that often require minimal down payment.

This is not typically an ideal situation, however it is doable. I would suggest talking to a local mortgage advisor about alternative down payment options such as grants, special loan programs, and DPA (down payment assistance) instead of defaulting to borrowing funds from your retirement accounts.