NON-RECOURSE IRA
Building Financial Freedom
1
Complete Loan Application
2
Provide IRA Statements
The combined funds in your IRA accounts must be sufficient enough to fund the purchase, closing, and reserve requirements make sure that your property is eligible for a Non-Recourse IRA Loan
3
Property Eligibility
Single-family detached residential properties, planned unit developments, duplexes, 4-plexes, multi-family properties (5+ units)
4
Sign Documents
Your IRA, LLC, or trust will be the owner of the property, requiring the property deed and title to be in their name. The transfer of funds for the loan fees (earnest money & appraisal fee) must come directly from the IRA custodian
5
Provide Transaction Details
The IRA must be listed as insured on the insurance documents. Provide details of the transaction to your homeowners insurance agent.
6
Review Application
We review loan applications, order the appraisal, review title docs, confirm the closing date, and more.
Loan Amount
Our non-recourse IRA loans can be up to a maximum of $815,000.
Term & Amortization
Our loans have term and amortization of 5 to 20 years.
Prepayment
Our IRA loans have a prepayment amount of around 1 – 3% depending on loan term and rate.
Loan Costs
These include standard fees like appraisals, surveys, escrow, and more.
General Guidelines
Interest Rate
We have both adjustable & fixed rate loans to fit your needs.
Non-Recourse
In the event of default, we can only look to the property as the sole source of repayment.
Application Fee
There is no application fee on our IRA loans!
Underwriting
Our underwriters have a quick turnaround within 48 – 72 hours of full submission.
Rate Lock
The interest rate is locked upon your commitment to the loan.
Loan to Value (LTV) Ratio
The LTV can be a maximum of 60% of the appraised value of the proposed property (not including reserves).
Security
For security on the loan, we are placed in a priority position in case of loan default.
Closing
Our average loan process takes about 30 – 35 days.
Advantages of IRA Investments.
Investment flexibility.
Non-Recourse IRA allows investors to choose their investments.Unlike traditional IRAs, which typically limit investment options to stocks, bonds, and mutual funds, non-recourse IRAs allow investments in alternative assets such as real estate, private equity, precious metals, private loans, and more. This flexibility can provide opportunities for diversification and potentially higher returns.
Potential for higher returns
By expanding the investment options beyond traditional assets, non-recourse IRAs may offer the potential for higher returns. Alternative investments like real estate or private equity can provide income from rental properties, appreciation in property value, or capital gains from private business ventures. These investment opportunities can help investors grow their retirement savings at an accelerated rate.
Tax Advantages
Like traditional IRAs, non-recourse IRAs offer tax advantages. Contributions to non-recourse IRAs may be tax-deductible, reducing the investor's taxable income in the year of contribution. Additionally, earnings and growth within the account are typically tax-deferred until distributions are made during retirement. Depending on the type of non-recourse IRA (e.g., Roth IRA), qualified distributions may even be tax-free.
Control and Self Direction
Non-recourse IRAs provide investors with a higher level of control and self-direction over their retirement funds. Investors have the ability to make their own investment decisions and choose the assets they believe will best align with their financial goals and risk tolerance. This level of control allows investors to actively manage their retirement portfolio and potentially maximize their investment returns.
Our Disclaimers
Before applying, review the following list of risks, requirements, and eligibility items:
Your IRA cannot purchase a property that you currently own.
You must avoid ‘indirect benefits’ and ‘self dealing’ with the property purchased with your IRA. This means that you cannot purchase, for example, a vacation home with your self-directed IRA. Further, any expenses incurred for the maintenance, repair, etc. of your IRA-held real estate must be paid to third parties, not you personally.
All income generated by property owned by your self-directed IRA must be paid into your IRA.
All expenses related to property owned by your self-directed IRA (maintenance, improvements, property taxes, condo association fees, general bills, etc.) must be paid from your IRA.
Nothing contained herein shall be construed as investment, legal, tax, or financial advice. Consult your tax accountant or tax attorney for information specific to you.