Last week, one of President Donald Trump’s top advisers floated the idea of allowing homebuyers to tap their 401(k)s without penalty to make a down payment on a home.
Late Thursday, Trump said he does not support the proposal, which was revealed last week by National Economic Council Director Kevin Hassett during a Fox Business interview.
“I’m not a huge fan of it. Other people like it. They’re talking about taking money out to put a deposit down on a home. And one of the reasons I don’t like it is that their 401(k)s are doing so well. 401(k)s are up 80, 90 percent in some cases. And you know, you’re talking about a lot of people,” Trump told reporters on Air Force One en route to Washington from the World Economic Forum in Davos, Switzerland.
“I like keeping their 401(k)s in great shape. I like keeping their 401(k)s. And I’m not a huge fan of that, putting down a deposit,” he continued.
According to a report in The Hill, Trump’s comments seem to mark a reversal on the administration’s stance on the idea after his aides said they were in the process of finalizing a plan that would allow people to use money from their 401(k)s for a down payment.
Hassett’s statements to Fox caused quite a stir.
“The typical monthly payment about doubled for an ordinary family buying an ordinary home. And the down payment they needed to buy a home went from about $15,000, to about $32,000. And so there’s a real lot of room to make up,” Hassett told Fox Business’ Maria Bartiromo.
“We’re going to allow people to take money out of their 401(k)s and use that for a down payment,” he said in the interview. “We’re still talking about the mechanics of it.”
The 401(k) idea is an example of how Trump is addressing the issue of affordability as Republicans grapple with it ahead of midterm elections in November.
In fact, Trump promoted some policies to encourage homeownership in his speech in in Davos.
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