Using IRA to fund projects
Question: Not on foreclosure, unless the arrears are less then $3000, although sometimes if you get them at just the right time they might sign a quit claim if the numbers are there and you flip to Investor. For example recently came across foreclosure where Deed was acquired for the $2000 forbearance and a small promissory note. Its the timing that is tough and do do Due Diligence. Have you considered investing in Notes, I know someone who could put that to work for you buying bad credit card paper. Hope that helps. I was wondering if anybody was out there that uses their IRA to fund their >foreclosure projects. If so what could $3000 help me out with??
Answer: Starting with 3000 is pretty small. I like your idea of $2000 forebearance. It would have to be a property with a good amount of equity. The problem is how would I be able to fix up the property with my money and then sell the property or rent it out and put the money back into the IRA?? From what I understand is that you can’t mix the money from your pocket and the IRA pocket, is that correct?? If you can find a property for $3000, you would need to resell to an investor “as is” or as a “fixer-upper” for a profit. In this way, you could pay back the money you borrowed and still have a nest egg to reinvest. Another avenue would be to “lease option” the property for a non-refundable option consideration of,say, $3000 – $5000, depending on the length of time of the lease. Whether the buyer exercises the option and purchases the property or declines on the option and walks away from the property, you still keep the consideration fee.
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