Updated over 4 years ago on . Most recent reply
HELOC on a free & clear rental owned in a Solo 401k
FB Family! Question - does anyone know of lenders that would provide a HELOC to a rental that I own free & clear in my Solo 401k? Always appreciate the help - thank you!
Most Popular Reply
NASB will do a regular non-recourse loan on that.
The way that we have done more of a "HELOC" type loan for properties in our SOLO401Ks (very similar to SDIRA) is to use a "Private Lender" (a family friend who has lent to us short term on non retirement properties also) who was happy to do a 'First Position Mortgage' on properties that we owned free and clear.
It was very simple, we just used a local lawyer that drafted the mortgage with the proper 'non-recourse' language in it. The last one we did was a 5 year Note @ 5% and 75% LTV. We used those funds as a down payment on another property.
We are using ALL of the cash flow from BOTH properties to pay the Note back in that short time frame, after which we will once again be 'free and clear' on the 1st property, and have none of our own funds into the second one.
Dan Dietz
The way that we have done more of a "HELOC" type loan for properties in our SOLO401Ks (very similar to SDIRA) is to use a "Private Lender" (a family friend who has lent to us short term on non retirement properties also) who was happy to do a 'First Position Mortgage' on properties that we owned free and clear.
It was very simple, we just used a local lawyer that drafted the mortgage with the proper 'non-recourse' language in it. The last one we did was a 5 year Note @ 5% and 75% LTV. We used those funds as a down payment on another property.
We are using ALL of the cash flow from BOTH properties to pay the Note back in that short time frame, after which we will once again be 'free and clear' on the 1st property, and have none of our own funds into the second one.
Dan Dietz