I understand that as a first-time home buyer I can withdrawal up to $10,000 from my IRA without penalty within 120-days of signing the purchase agreement or closing on the home. Income taxes still apply of course, but I at least avoid the 10% penalty.
With that being said, I signed a purchase agreement/agreement of sale on October 1, 2016 to BUILD a home that should be completed in March/April 2017. The deposit for this amounted to around $28,000 of which I payed for out of pocket. I've been thinking about withdrawing $10,000 from my IRA to "back-fill" my savings account, but since I have 120 days to do so, could I take this money out in January 2017? I guess the answer would be yes, since I would be closing on the home within 120 days after withdrawing as well, but I want to be certain.
Bonus - do mortgage companies care if you use retirement funds when purchasing a home?