If I have a wage garnishment for student loans and cash in my 401k, will all or part of that money be seized?

Both my private and federal student loans are in default. I don't get a tax return any more, but I do not see anything on a pay stub that looks like a garnishment. I recently started a new job which means I can cash in my 401k from my previous job. If I can, I was hoping to use that money to put a down payment on a house. Is there a way I can do that without having all of that money seized? I know there's a healthy penalty for early withdrawal, but I am just not sure if the government/creditors will take that money if I cash in my 401k.

College Tuition, Debt, 401(k)
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July 2016

As long as the money is in an ERISA protected retirement account - like a 401k - it is protected and can’t be seized. If you cash out a 401k and move the funds to your checking account, the money is no longer protected by ERISA and could be subject to garnishment. Also, a mortgage lender will consider the student loan defaults when deciding whether to lend money for a new home. This means you will either not get the home loan or the lender will charge an incredibly high interest rate that will make the home purchase very unattractive.

Your best bet is to keep the money in the 401(k) or roll the balance into an IRA to keep the assets protected until you work out the other issues.