Not saying this is a good idea, but honestly it was something I was just curious about.
My and other 401(k) plans allows you to withdraw from your 401(k) before 59 years of age for "hardship" for the purchase of first home. But what if you did that and then the home purchase fell through or someone decided to just buy a car with it? (Obviously a terrible idea.)
I've seen people do this on forums. Wouldn't that be illegal? I mean obviously the 10% penalty would come into play.