No, it won't affect your credit rating. You are simply borrowing your own money. There is not even a credit check to lower the credit score.

no i would not affect your credit.. but did you know you can use what u got in your 401k to put down on a house .. that would lower your house payments

No it won't. It is your own money or fund that you are borrowing against. The real question is do you really want to put your own nest egg on the line for a home? I would just find a bank that will loan you the money without putting the 401k up for collateral. Don't risk what you have saved in the 401k!

No, it won't affect your credit rating, nor will your credit normally be considered before the loan is approved. There's a couple of concerns however. Normally, if you borrow against your 401k, the amount of your 401k securing your loan will earn the interest you pay on the loan, but will not earn market returns. In other words, if you borrow $20K against your 401k, and the market goes up 20% next year, the $20k collateralized against your loan will not get the 20% return, it will get the 5% or whatever your loan rate is. The other concern, is that if you lose your job (or quit), normally the loan is considered payable in full immediately. If you cannot (or don't) pay it off, the 401K will be liquidated to the extent necessary to payoff the loan, this will be considered a non-approved early withdraw from your 401K, and you'll be responsible for the associated taxes plus and additional 10% penalty (if you're not 59 1/2 years old). It might make sense for you if the following are true: 1) the loan is small relative to your 401k balance (minimal affect on return), 2) you could pay the loan off if you suddenly lost your job, and 3) the loan is for a relatively short period of time.

Most financial advisors discourage borrowing against your 401k except in the most dramatic circumstances.