All Forum Posts by: Ken Badziak

Originally posted by @Daria B.:

How does one loan funds to other investors (opion-c)? Would the SDIRA have to approve of the loan-out and wouldn't this be considered HMLing and what specifics are involved if that is the case? Is it a contract just between the person being loaned to and the SDIRA owner (by way of FBO-owner in the IRA)?

 I would get in touch with your SDIRA provider. They would have all the proper paperwork to facilitate that type of transaction.

I personally have never lent my money out to other investors, but I know plenty who have. In my particular case, I only had $50k in my SDIRA, and I found my options extremely limited. I could've lent the money out or invested in notes, but I'm more interested right now in asset accumulation.

I ended up simply rolling my SDIRA into my current 401k and taking a loan against that, thereby being able to utilize almost 100% of those funds (not quite at $100k in the 401k, but close) and purchase a duplex with a conventional 30 year loan.

If I had $150k or more in my SDIRA I would have looked at other options, but with only $50k I found the path I chose to make the most sense.

@Daniel Dietz, you need to re-read my post. I never said it's not worth investing nan SDIRA or Solo 401k.

What I said was "Short of buying a property in cash and having it managed at a distance with a professional property manager"...

Purchasing in an IRA makes perfect sense... IF you're going the "all cash" route. And, as in your case, with 20 years of savings under your belt, you had enough cash to purchase the property outright.

What DOESN'T make sense is to use the IRA to purchase the property using leverage. It gets really complicated at that point. Or to use the IRA for an "active" endeavor such as flipping.

IRA's are great for passive purchases; buy and hold with a property manager, notes or lending out to other investors.

Short of buying a property in cash and having it managed at a distance with a professional property manager, I think you'll find that the hassles and headaches of "traditional" IRA real estate investing just isn't worth it. Especially labor intensive endeavors like flipping. I think you'll find that using an IRA works best if you a) purchase in cash and have a professional property manager, b) invest in notes or c) loan your funds out to other investors for a higher rate of return than what one could expect from Wall Street. Could you flip houses in an IRA? Sure. But with all the red tape, why would you want to?

Jesse Danzig it's outsourced as far as I can tell. With whom in not sure yet. After waiting nearly a month and a half to speak with Clayton but then getting his underling David instead, I haven't received any follow up emails or anything from the group. Contrast that with the continuous follow up and feedback I'm getting with OhioCashFlow and USAPortfolioRE, I think I know where my next turnkey purchase won't be...

Take a dump truck, load it with horse manure, and drop it off on the front yard. Guarantee you won't hear any more dead rodent smell complaints! That being said, if it were my property I would bite the bullet and find that dead rodent. Last thing I'd want is a source of disease and other nastiness rotting away inside one of the walls. Seems like a huge lawsuit waiting to happen. There's prolly a service available that would do that for you. Find the dead rodent (dogs maybe?) and remove it.

I'm investing with the Holton Wise group up in Parma, in the Cleveland area. Closing one one deal hopefully this week, and looking at another soon. My work takes me to Cleveland occasionally, and each time I'm more and more impressed with the area. Give Nicholas Varner a call at Holton Wise. He's been doing well by me!

Originally posted by @Prashanth Prash:

Thanks  @Chris Mason I understand that if you can take out a HELOC and own a property with enough equity.

Any other ways to do it without that?

 I took a loan against my 401k for my down payment on my duplex.

For conventional financing on a multi-family, banks for the most part require 25% down. Maybe you can get less if you have a good working relationship with a local bank or credit union (portfolio lending) but if you're looking to get conventional money through a bank using Freddie Mac or Sallie May guidelines, it's 25%. SFR's are still at 20%, though. Really the only other way to do a "low money down" purchase would be to find a duplex where the owner is willing to carry the note. Then the monies out of pocket really boil down to how motivated the seller is, and how well you can negotiate the deal. So yes, there ARE ways. But not conventional ways...

Originally posted by @Sunny D.:

...and hence i am sticking to holton wise in cleveland for now.

 My first duplex is under contract right now, also with Holton Wise

Originally posted by @Michael Lee:

Hello! I was commenting about you and your injustice.  I am 59 years old and I was born and raised in Dallas Texas and I have seen a bunch is crap and that is what I saw.

 Drinking and Internet. Usually not a good combo.

Friends don't let friends drink and Internet.