Self Directed IRA for Investing

[Adrienne Medina]

Hi all! I have had a Self Directed IRA for about 5 years that has just been rotting...zero interest and a 3 digit account maintenance fee deduction every year by the holder. I need to do something with this money! There is a decent amount in there but not enough to buy a property. It would be enough for a down payment on a home but being a 1099 employee it is rather difficult to obtain traditional financing. Any recommendations on how I can invest with this IRA?

[Dmitriy Fomichenko]

@Adrienne Medina,

You should establish truly self-directed Solo 401k plan (you qualify as self-employed and it has several major advantages over self-directed IRA). Then you can rollover your current IRA and invest. This plan allows virtually unlimited investment options. If you don't have enough to buy an investment property outright you can use leverage. However, rules don't permit providing personal guarantee therefore you must use non-recourse financing, typically need 40% down. Here is a list of lenders offering such loans:

https://www.biggerpockets.com/blogs/2810/50272-lis...

I'm really big fan of using retirement funds for private lending,  you can get decent return (10%+), risk is low and it is truly passive. You can also invest in note fund or syndication.