My IRA does not have enough money to purchase a piece of property outright. Can my Self-Directed IRA get a loan and use my IRA money as the down payment?
Yes you can use your IRA money as the down payment and then have your Self-Directed IRA get a loan for the balance. However, you will not be able to personally guarantee the loan. It must be a non-recourse loan, which means that if your IRA fails to make payments, the only recourse the lender has, is against the property itself. We currently have access to such specialized lenders. However, there will be tax ramifications to doing so; an UDFI (unrelated debt financed income) tax applies when a loan is obtained. This is a more complicated purchase and will require a detailed loan application and additional tax reporting for the life of the loan. We can assist you with both of these requirements.
Related Questions
- I don’t have enough money in my IRA to purchase a piece of property outright. Can my Self-Directed Retirement Solutions, LLC get a loan and use my IRA money as the down payment?
- I don’t have enough money in my IRA to purchase a piece of property outright. Can my Self-Directed IRA or 401K get a loan and use my IRA money as the down payment?
- My IRA does not have enough money to purchase a piece of property outright. Can my Self-Directed IRA get a loan and use my IRA money as the down payment?
