Next Step In An IRA Real Estate Purchase
Last year I opened a self-directed IRA and used the funds to purchase a small lot with lake access. Made some inexpensive improvements and resold. Now I am trying to decide whether or not to buy two lots and repeat the process or use the fund for a 20% down payment on a rental/rehab unit. Financing can only be through a non-recourse loan. Anyone have experience in obtaining this type of loan? I understand the basic concept of the loan, what should I expect from a lender? I have had many rehab loans but not this type. ?
Thanks for taking the time to give me direction, the link had a good article explaining non-recourse loans so the fog has lifted on that, I signed up for their forum and will be looking for a property shortly.
Non-recourse lending is done by certain lenders, perhaps your SD-IRA trustee could give you some leads. You could also read the forums at www.iraplus.com for possible leads.
Another option to consider is to partner with your IRA for the purchase.... the IRA would own 20% and be on the deed as co-owner with you. In this situation, you could obtain regular financing for your 80%. The research I have done shows that this is within the rules. However, do not take this as legal or tax advice.
I would like to learn more about these types of accounts. How much can you contribute in a tax year? And, can this amount be in addition to an employer retirement plan, etc. Does anyone know of an unbiased/non-commercial article or information site on these types of accounts?
Maybe this has been answered before...does a non-recourse loan have tax implications? If so, what are they?
Thanks!