Link. You pay back using after-tax money.
I'm not that money savvy, so feel free to correct me. A $46k 5yr loan at 9% APR would require a payment of $954.88 per month. Over 60 months that is $57,293.06 to pay off the loan.
Looks like, assuming a static 9% growth in the market, the $954.88 payment would yield $72,021 after the last payment. Just leaving the $46k in to earn at 9% yields about the same amount (actually slightly less), so it does look like near net sum zero.
If you are in the 22% tax bracket, assuming that you worked a few extra hours each week and took home a bit more money to pay for this loan (thus using your marginal rate), this would require $73,452.64 of additional income to make this $57k payback (Uncle Sam gets the $16k difference) (and I'm not including state income tax). Now if you were just doing without someplace else, say cutting vacations, cutting cable, whatever, then no extra loss to Uncle Sam, and perhaps a net win for you. If you wind up cutting back on your 401k contribution instead, so as to free up this money, you increase your taxable money in the process, so... it gets very case specific.
So this sounds like it might work to me. You should set up a spreadsheet and run the numbers. Set up two budgets and two 401k scenarios, and see what comes ahead of the other. Or makes you sleep better at night. [I hear some use 8% for stock market growth, others 9%--but that's looking at the S&P 500. If you have a retirement target index fund, or a mix of bonds in there, your growth rate could be lower, and you should make sure to use the rate that your portfolio is growing at, or the rate of the holding you are selling/buying for this endeavor.] Predicting your future income might be as hard as predicting the stock market but it is something only you can put numbers to.
Locking in the APR might make you sleep better at night, and a net savings over time, and perhaps increase your wealth. But it has the risk of potentially needing to pay back the 401k if you change jobs, else risking a 10% penalty on top of it now becoming taxable income. BUT... since this $46k loan won't make the HELOC go away, and you get stuck carrying both for a period of time, this sounds like something rather stressful. Can you carry both loans, and this is just an attempt to maximize your money? If so, then I think you are stuck running the math to determine so. It's the generic case that most of us are reacting to, in that for the average person this is a terrible idea, for a number of reasons. If this is just a matter of, you have the income, but maybe if you play this money hack, perhaps you can get ahead... it's an interesting case to ponder.
Since this $46k loan won't erase the $62k HELOC, what is the plan for the $12k left in that? Just pay the interest portion for the next 5 years, or whittle it down slowly each month with some pocket money on top of the interest, or figure out how to knock that out quickly and get to just the 401k loan as soon as possible? That would be details to put into those budgets, and you may wind up with multiple scenarios for you to chose from.
