2 thoughts on “Using Your Self-Directed IRA to Make Small Real Estate Investments

    1. One of the biggest misconceptions with Real Estate Investing is that you need hundreds of thousands of dollars to invest. This is simply not true. There are several different real estate investment strategies that take very little money at all.

      Partnering your IRA with other IRAs or non-IRA money, or buying a property with debt, are two ways in which you can utilize other sources of funds to help acquire property if you only have a small amount in your own IRA.

      Wholesaling is a another way to turn a small investment into a potential profit. This type of investment only requires an EMD (Earnest Money Deposit) in most cases. Wholesaling is when the investor gets a particular property under contract, and simply sells the contract to an end buyer for a “wholesale fee”.

      Options are another great investment opportunity that requires very little upfront investment. An option fee can be negotiated in exchange for “the first right to buy” a particular property. There are several exit strategies the investor can take from there; 1) Let the Option Expire. 2) Exercise the Option and buy the property at the negotiated price. 3) Assign the Option to a 3rd party for a fee. 4) Release the Option back to the seller for a cancellation fee. Options can provide great flexibility for the investor.

      Many of the above strategies are highlighted in some of our educational webinars that can be viewed live and/or online through our website. Remember that Quest Trust Company does not give tax, legal, or investment advice, but I hope these brief examples help to answer your question and broaden your knowledge about Self-Directed IRAs and real estate investments.

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