Self Directed IRA
Mortgage Lending

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A non-recourse loan is the only type of loan allowed for a Self Directed IRA. According to rules and regulations, the holder of the account, the IRA or any business entity funded by the IRA cannot be held liable for the loan repayment.   

 

Ideally a lender would like to have a personal guarantee in the event of default on the loan. Because of this fact, there are few lenders who offer true non-recourse loan programs.  Those that do generally require a minimum down payment of 30% – 40%. This ensures that, in the case of default, the property can be sold and the loan paid in full.

 

Also, the IRA or business entity must have enough cash flow and/or reserves to make the loan payments, maintenance, insurance, dues and taxes. About 20% of the loan amount should remain in reserve, unless cash flow is more than adequate to cover expenses.   

 

IRA123 has Mortgage Brokers available to assist with obtaining this type of loan. For more information, questions or comments, please fill out the form below.