September 8, 2025 • 27 mins
Visit altassetsummit.com to learn how to invest in Alternative Assets.
(More links down below.)
In this episode of the Directed IRA Podcast, attorneys Mat Sorensen and Mark J. Kohler dive into five creative ways to buy real estate with your self-directed IRA. Beyond the traditional “pay cash” approach, they explore strategies like seller financing, non-recourse bank loans, subject-to deals, wholesaling, private lending, and even the Roth Dream Home Takeover (a little-known method to lock down your future retirement home tax-free).
They share real client examples, key compliance rules (like avoiding personal guarantees), and why pairing these strategies with a Roth IRA can supercharge compounding and keep more returns in your pocket. Whether you’re a seasoned investor or just discovering the power of self-directing, this episode will open your eyes to opportunities you may not have known existed.
Chapters:
00:00 - Introduction to IRA Real Estate Strategies
03:16 - Creative Financing Through Self-Directed IRAs
06:53 - Wholesaling Properties With Your IRA
09:25 - Becoming the Lender With Your IRA
13:00 - The Roth Dream Home Takeover
18:54 - Partnering Strategies and Tax Liens
23:48 - Alt Asset Summit Invitation
Directed IRA Homepage: https://directedira.com/
Directed IRA Explore (Linktree): https://linktr.ee/SelfDirectedIRA
Book a Call: https://directedira.com/appointment/
Other:
Mat Sorensen: https://matsorensen.com & https://linktr.ee/MatSorensen
KKOS: https://kkoslawyers.com
Main Street Business https://mainstreetbusiness.com
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:08):
Welcome to the Directed IRA Podcast.
My name is Mark Kohler.
I'm here with the amazing MattSorenson on a topic today that I
just think is super powerfuland many of you may have not
heard of these strategies.
Five creative real estate Idon't know.
Acquisition strategies what doyou call them?
Speaker 2 (00:26):
Yeah, I think there's just five strategies you should
be using with an IRA whenyou're investing in real estate.
Some of you might be like yourIRA can own real estate.
Yeah, and we're going to talkabout some common ways.
We've seen clients structuredeals to acquire properties that
you probably haven't eventhought of.
Yeah, and I think many of us.
Speaker 1 (00:44):
When you grow up I did, and it's like you're going
to buy real estate.
You walk down to the bank, youget a mortgage, you buy a house.
You know it's just like.
That's how it works, oh my gosh.
Well, stay up late night andwatch Plastic Magic on TV and
all these creative acquisitionstrategies that people use to
buy real estate.
Well, many of them you can usein your self-directed IRA.
(01:04):
How can I take my self-directedIRA and make money in real
estate?
Well, we're going to share fivestrategies with you today.
I think it's going to be a lotof fun, but we got to get off
the table first.
Asset classes are notstrategies.
Speaker 2 (01:18):
Yeah, yeah, like a buy and hold.
Long-term rental is not astrategy.
That's an asset.
You're owning this property buyand hold.
But we want to talk about theacquisition strategy to get that
property, maybe, or some of thedeals you can do around it,
from your IRA.
So that's first, and that'seven like the first deal I ever
did with my own retirementaccount, which is buying, a buy
(01:39):
and hold rental.
Speaker 1 (01:40):
Yeah, I love it, so some of these, I'll just write
off a few short-term rentalrental yeah, I love it, so some
of these, I'll just rat off afew Short-term rental.
Long-term rental storage units,commercial property, water
rights, fix and flips.
Fix and flip.
Those are acquisitions in thereal estate lane but they're not
(02:01):
the strategy to get that asset,and that's oftentimes the
hurdle.
We see something we want, wejust don't know how to get it.
Speaker 2 (02:06):
Let me explain what we're talking about here.
We say the acquisition strategyis well, I just have, you know,
300 grand in my account, in myIRA account, and I'm going to
buy a $300,000 property.
Okay, your acquisition strategyis just to use the cash in your
account to go buy that, whichis one strategy and that's cool.
It's not a creative one.
We're going to hit somecreative ones Now.
We've had there's probably aclient every hour to doing a
(02:30):
deal with that, with their IRA,in that way, in cash, which is
fine.
But we want to go over somecreative strategies that many of
you might've thought oh, Ican't use my IRA for that Cause
you weren't thinking of thecreative strategies in real
estate.
Speaker 1 (02:42):
Okay, well, I like let's kick it off with that as
our kickoff.
So if you're going to buy that$300,000 property with cash, all
right, that's cool.
Not too creative.
There's pros and cons to thatmethodology, but a creative
strategy would be I'm going tobuy two properties of 300 grand
each and I'm going to get, let'ssay, seller financing.
(03:02):
I'm going to put down 150,000and have the seller carry the
paper on the $150,000.
And now I can buy twoproperties, still cash flow, get
a better ROI in the long runand have more leverage for more
equity build, and that'screative.
Speaker 2 (03:19):
I love that.
That was a great example rightout of the gate.
And let's say that the sellerwon't negotiate seller financing
.
Well, what can you do?
You can get a new bank loan,even all right, there are
non-recourse lenders that willlend your IRA money to buy real
estate, particularly on a buyand hold property.
I've done that.
That was the first deal I did.
I just had a bank lend me moneyon that property.
Speaker 1 (03:39):
Well, that's funny, because the first one I did was
a seller finance, yeah, and thefirst one you did was more of a
bank a non-recourse loan bank,yeah, so, um, now there's rules
on this.
Speaker 2 (03:50):
Of course, when you're getting debt, whether
it's seller financing, you'regetting a new loan, you can't
personally guarantee the debtand we've got a lot of other
podcasts and videos aboutself-directed IRA rules and
prohibited transactions.
But just know that's a ruleWhenever you're getting debt on
a deal, whether it's sellerfinancing or a new loan, don't
personally guarantee it.
Okay, that'll violate the rules.
Speaker 1 (04:10):
Yeah, now, staying in the same genre of financing,
there's also a third option andthat's buying a property subject
to.
I'm not going to ask the sellerfor financing, I'm not going to
go get a new non-recourse loanwhen we have lenders lined up
for you to choose from if you'dlike, but there may already be a
loan on the property and theseller's like I got to get out
of this thing.
(04:30):
If you'll just assume thecurrent mortgage and it's got to
be that non-recourse format,you can't go sign on it
personally, but there might be aproperty with lending already
on it and you can buy theproperty subject to that loan,
and that's another way to getyour IRA in a deal when it may
not have enough money due tocash flow.
Speaker 2 (04:49):
Yeah, and this is when we've seen a lot of clients
get into with a lot of hardlyany money down because they
could be putting maybe 5,000,$10,000 down.
Maybe there's some improvementcosts or some things that need
to improve the property beforeit's rent ready, but they're
coming out of pocket a lot less.
So some people might be doing adeal for $25,000 or less where
they're acquiring the propertysubject to.
(05:11):
Another thing we've seen onsome of these, and an incentive
for this in acquiring theproperty subject to, is a lot of
people are trying to sell ahome and they got some value.
They can't get out of it, butit's got an incredible rate on
it.
It's at a two and a half or 3%mortgage rate and being able to
acquire that property subject tothat mortgage makes it a very
(05:34):
valuable property in terms of arental, because now your costs
to hold it are very low.
You can get better cashflow onit.
So this is one where we've seena lot of savvy real estate
investors use it.
Of course, you can use thesubject to strategy outside of a
retirement account, but alsoyou can use it with your IRA.
Go buy that deal, get thatproperty.
It takes probably a little bitof money down, maybe some money
(05:55):
to improve it, but you just takeover the existing mortgage.
It's called a subject tostrategy.
Speaker 1 (06:00):
Well, I love it.
Now.
I I just as an aside, I don'twant to be offensive today, but
you look a little stuffy.
I I brought a little party.
You know, after 12, you go twobuttons down, you know, did you?
Speaker 2 (06:13):
did you bust that button or is it just optional?
That was, that.
Was, that was intentionally.
Speaker 1 (06:17):
Yeah, I was watching John Travolta last night late
old show and I just I think weneed to bring this back.
You know, just let's let thatsecond button go.
Speaker 2 (06:27):
Mark's a married man, so you know.
Speaker 1 (06:28):
Patty, just you know, she, you know she's like show a
little skin bro.
Speaker 2 (06:32):
Yeah, you got it.
Speaker 1 (06:36):
If you've got a convertible drive at the top
down, exactly.
I mean, it's just the way itworks, yeah, so all right.
So okay, number two I'm tryingto keep you interested in a
typically a very boring topic.
But no, we bring it with some.
This is dinner and a showpeople.
Okay, number two.
Now these are creativestrategies in the real estate
industry to make money with yourIRA.
(06:57):
One of them is wholesaling.
It's that same $300,000property but you only have
$30,000 in your IRA and you'relike, man, that is an awesome
property, 300 grand.
I can't buy it with cash.
I don't have enough money toget lending.
I'm going to just tie it up.
I'm going to make an offer thatI'm going to buy it for 300
(07:17):
grand with a $30,000 downearnest money agreement.
But I can assign the contractbecause I think it's worth 350
and I can go shop it and sellthat.
Maybe make sure your earnestmoney is refundable if you can't
shop it in time.
But that's called wholesaling,where I'm going to tie up a
property and pretty much flipthe contract or the opportunity
(07:39):
to buy it for 300.
We've had clients make hundredsof thousands of dollars.
Speaker 2 (07:44):
Yeah, and it could even be a $5,000 amount that you
do need to pay something fromthe IRA to tie it up, right,
there's some legalities to that.
But now, if that property isworth 330 and there's other
investors that would want to buyit, if you're able to find the
deals and this is where, again,if real estate's what you know,
and some of you already in dowholesaling by the way, I know
(08:05):
some of you already dowholesaling.
They're listening to this.
They're like guys, I know thestrategy.
You didn't explain it very well.
I'm like, yeah, but do it withyour IRA.
Why would I do that with my IRA?
Well, let's do a Roth IRA.
Okay, let's say your Roth IRAputs five grand down on this
wholesaling deal and let's sayyou make 20 grand on that.
That 20 grand goes back intoyour Roth IRA, no tax and coming
out totally tax-free atretirement.
(08:26):
If you do that wholesaling dealoutside your IRA, it's going on
your 1040, ordinary income, allright, it's going to be your
regular rates plus state tax.
So a lot of times thesestrategies, if you couple it
with the self-directedretirement account, it becomes a
really good tax play.
Oh, you put it on steroids,yeah, and wholesaling would be
one.
(08:46):
You know there's anotherversion of wholesaling that is
like real estate developers use,which are options where they'll
get land under option contracts, do some pre-development work
and then they'll sell it for abig premium.
We've had clients make over amillion dollars selling options
with their Roth IRA where thatvalue that they can create on it
, either through a hold periodor some paper development type
(09:07):
stuff, can have a million dollarplus return back into the Roth
IRA, no tax.
Now you could have done thatoption deal outside of your
retirement account but you wouldhave paid Uncle Sam and your
state.
You know these silent partnersthat want a piece, you know.
But if you want to keep it all,I'm just saying, use the Roth
IRA.
Speaker 1 (09:25):
I love it.
All right, that's strategy two.
Do you want to throw down?
Speaker 2 (09:27):
three, yeah, I like three.
This is what I do the most, andthis is being the lender on
deals.
So think of yourself as thehard money lender the bank, you
know, the mob, whoever you know.
When someone needs money, yourretirement account can fund that
, you know.
Speaker 1 (09:47):
Yeah, we're promoting mob strategies here, so I think
it's an exorbitant interest.
I know Matt.
Speaker 2 (09:59):
Every good mafia movie you know with the mob has
somebody that lent money andthey got behind and someone's
getting their knee broken.
Speaker 1 (10:02):
That's part of every mob.
Speaker 2 (10:03):
Show you're right I'm just trying to relate, you know
.
Speaker 1 (10:05):
Yeah, yeah so and this is again a very common
strategy in the in real estateindustry, but people don't
realize my ira could be doingthat same deal and if you're
doing 12 and 2 for some of youthat are in the business know
that that's a 12% annualinterest rate and two points and
(10:26):
if you can flip that loan twicea year, doing short-term loans
for real estate developers or-.
Speaker 2 (10:32):
Flippers or any real estate investor that needs
capital.
I mean, that's what I'm doingright now, and I know you guys
have done some private moneylending too.
It's just a good way to get agood return on your retirement
account right.
If I'm getting 12% plus twopoints on six-month loans, I get
the two points twice a year.
That's four plus 12.
That's 16% annual rate ofreturn.
(10:54):
Now you get a lien on theproperty right First trustee.
Turn Now you get a lien on theproperty right First trustee.
Right First trustee.
You might be in second Ifthere's enough equity in the
deal.
You want to be careful Don't dobad loans to people that don't
know what they're doing orproperties that don't have
equity right.
So, but that's a great strategywhere you can access deals but
you don't have to run the deal.
You don't have to be like theperson that goes that, finds
that wholesale deal or thatoption property that negotiates
(11:16):
that subject to or sellerfinancing deal, and so this is a
little more of a passive play,but it's creative in the sense
that you're using yourretirement account and I had one
.
I remember I talked to oneclient.
He's got a seven figure plusaccount, and when he heard about
real estate investing.
He was a real estate investor.
He was like he just got so hungup on all the tax things.
(11:38):
He's like I don't want to ownreal estate.
He's like I'm just going to doprivate lending and I remember
him talking about that becausehe did private lending
personally.
And he's like Matt when I lendmoney private, it's interest
income to me.
I'm at a 30% federal tax bracket.
I'm at like 8% in my state.
When I make a hundred thousanddollars on lending my personal
money, I really only made$55,000 because of my federal
(12:00):
and state taxes that eat up intothat.
Once I learned I could do thiswith my retirement account and I
make a hundred grand ininterest, I kept a hundred grand
and he's like it's been insanethe amount of compounding growth
.
If I look at my bucket of moneythat I lent, that I've always
been lending for and I've beenlending on a longer period of
time but on my taxable moneythat hits my 1040 versus my
(12:23):
bucket of money in my retirementaccount that I lent out and he
has a Roth that I get to keepevery penny he's like it's
insane how much this one hascompounded more of the last 15
years.
Yeah.
Speaker 1 (12:32):
Yeah, he had me at Roth, thank you.
Speaker 2 (12:34):
You're welcome.
Speaker 1 (12:35):
Yeah, don't say another word.
Okay, renee Zegler.
Okay, now number four, and thisis one of a strategy I've had
several clients do throughout mycareer.
I've seen it.
I would like to see it more.
I think it's a really coolstrategy.
I can guarantee nine out of 10of you listeners have not heard
of this strategy, and I call itthe Roth dream home takeover.
(12:58):
All right, now what this isabout.
We had a couple I love yourbranding.
Speaker 2 (13:04):
You're like branding.
Are you going to trademark that?
Damn straight.
Speaker 1 (13:08):
Not to be used without the express written
consent of Mark J Kohler and theNFL.
Okay, so now on this takeover.
Okay, and let me throw this out.
I'll tell you the strategy andthen a little story.
It is looking down the roadfive to 10 years and saying
that's where I want to live,that's where I want my dream
home.
I'm going to retire at 59 and ahalf later and I want to be in
(13:31):
Boca Raton, I want to be inAspen, I want to be in this
beautiful area.
But, holy crap, 10 years fromnow, anything I want now is
going to be twice as much then.
And how am I going to afford it?
It's not going to happen.
And so you have this dreamlocation, this dream property
that you want to be at when youretire.
How you get there?
(13:52):
Well, I've had several clientsfind that property now, when a
deal comes, because they can'tmove now.
But the opportunity comes.
So they're ready and they buythe property in their Roth IRA
with maybe the subject tostrategy, the seller financing
strategy, the non-recourse loanstrategy, whatever.
(14:13):
But they find this property andthey buy in the name of their
Roth IRA.
Okay, can you move into itright now?
No, that would be a prohibitedtransaction.
You can't live in your IRA'sproperty.
But they buy it now and thenthey take all the cashflow from
that.
They short-term rental it, theylong-term rental it.
They know they're going to bethere someday and they want to
(14:33):
do a rehab.
They're so excited when theycould go in and put in their own
furniture and paint new carpet.
But for now it's just going tobe a rental property.
But it's the place they want tobe and they let the Roth IRA
own it and take all the cashflowand pay off that mortgage as
fast as they can.
59 and a half comes along, 60,62, whatever.
(14:53):
And that time comes to load upthe U-Haul and go you can call
it directed IRA and go.
Will?
You just deed me that propertyTax-free, no tax at all.
All the equity growth, all thatcashflow paying down the
mortgage, any equity in that,the Roth IRA value itself goes
to you tax-free, no penalty,nothing.
(15:16):
And if there's still a mortgageon it, fine, pick up the
mortgage.
You can go in and rehab it,make it a fresh for you.
So you're locking down inadvance the property you want to
live in down the road andletting your Roth IRA hold it
for you and you're going to takeit over when the time's right.
Speaker 2 (15:32):
I love it.
Now, pen drop yeah, I love that.
That's as you explained itright.
There is the way to do it.
Now keep in mind when thatasset is coming out after 59 and
a half, there's a reason.
Mark said that that's when youcan take money out of your Roth
IRA or assets tax-free.
So here we're not selling theproperty and taking cash out.
(15:54):
You want to use the property.
You like the property.
That was the reason you boughtit.
That was one of the vision youhad in the future.
So what we do is we get anappraisal of the property to set
the value and then that valueis distributed out to you.
Now the key thing Mark used wasa Roth IRA, because when we're
distributing that Roth IRA assetout to you, there's no tax on
(16:15):
it.
But I'll give you an example.
I had a client who called me upand he had bought this property
.
It was in Florida.
I don't remember where.
It was, not Del Boca Vista, itwasn't.
It was not, but Morty Seinfeldwasn't involved or anywhere.
It's a little Cadillac, it's agolf cart, okay, but he did buy.
(16:39):
I remember when he told me hesaid I bought this in my IRA and
he's wanted to move into it.
And he said I bought this inthis area because I had stayed
there with friends that had aplace in the same place and my
wife and I fell in love with it.
We saw the real estate goingoff the charts here.
We thought let's go buy one,let's lock it in, let's lock it
in.
And he said I just did it withmy IRA and he had actually just
short-term rental.
(17:00):
Okay, now he wasn't using it,all right, but they had that
vision you were talking about ofman.
When we quit the day job, wewant to come at Del Boca Vista,
all right, playing cards withMorty Seinfeld man how would it?
be.
So now here was the snag.
(17:22):
He had a traditional IRA.
Okay, this was done as atraditional account, and so it
was interesting because thatproperty was actually doing
pretty well as a rental.
He was actually making goodcashflow.
So we weighed the pros and consof him distributing it out.
What was it worth?
Now it had gone up in value, itwas cashflowing great as a
(17:44):
rental, and what he actuallydecided to do was just to buy
another property in the samedevelopment personally, because
that property was performingwell in terms of cashflow and it
was still growing, and hedidn't want to take the hit for
the traditional.
So the key was if you feel likethat play is going to be, that
(18:04):
area or place where you want tobe in 510, whatever that window
is is appreciating, it's goingto be a hot market.
You definitely want to use theRoth IRA, so it comes out tax
free.
Yeah, and here's the workaround, everybody.
Speaker 1 (18:15):
Do the chunk.
Take the Roth conversion earlyon because you could get an
appraisal.
This couple could have beenback when they first bought it
and they knew it was going tohighly appreciate it.
Get a valuation with anappraiser.
Tell them I want the lowestpossible value, which is not
what appraisers are typicallytold.
And say I want the lowest value,you can justify it, roth
(18:37):
conversion that you can standbehind, and then Roth conversion
, so rip the Band-Aid off back,then pay the tax on that
property value.
Then in that five to 10 yearrunway they pull the trigger
Exactly Yep, no tax, yep, so fun, fun, fun strategy.
Speaker 2 (18:54):
Okay, number five All right, let's talk about
partnering.
Yeah, partnering.
I think this is a reallypopular one.
As a lawyer, I probably set upover a thousand LLCs with
someone's IRA in the LLC as apartner.
There's a lot of variations ofhow this could look.
This could be a combination ofIRAs partnered together in an
LLC.
This could be your IRA, yourspouse's IRA, your kid's Roth
(19:16):
IRA, your health savings accountall into one LLC going to do a
real estate deal.
Whatever that asset class is inthe real estate space.
Maybe it's a storage facility,maybe you're flipping a property
any of this other stuff we'vetalked about.
Another variation could be andwe've said this one quite a bit
is maybe your IRA is like thecash partner in a deal and
there's some other investorwho's like the work partner, you
(19:38):
know, and you have a splitpercentage of ownership and a
credit partner.
Yeah, you could even have acredit partner in the mix too,
if needed, in the deal.
So, and we could go on withdifferent iterations of that,
and maybe you would like to, butI was going to say there's a
lot of variations of how thatcould look.
Speaker 1 (19:54):
And we've got some great podcasts that are on folks
.
If that's already entertainingto you, get over and check out
those podcasts on the IRA LLC.
And the one I'd like there themost is a college savings type
angle.
You're doing real estate,you're in the real estate realm.
You're like, oh, I can do this.
And they do have children thatare 5, 10, 15 years old.
(20:15):
You know they're going tocollege in 5 to 10 years.
You're like, but you don'tthink and say you know what, I
can put their covered LIRA inthis mix.
Just throw in two grand intheir covered LIRA or a couple
grand for double up a couple ofyears if you can Get your kid's
Roth IRA going even.
And so now you're using astrategy for some exit on this
(20:38):
property 5, 10 years from nowwhen your kids are going to
college and their covered LRAcould come out tax-free for
college.
And it's just a 1% owner.
It doesn't have to be a lot.
Speaker 2 (20:49):
It's base hits, yeah.
Base hits win games yeah.
Speaker 1 (20:53):
All right, now I'm going to throw in a bonus.
I got a bonus.
Speaker 2 (20:55):
Oh, all right, Now I'm going to throw in a bonus.
I got a bonus, oh, all right.
I'm curious what this is.
All right, here's a bonus.
Speaker 1 (20:59):
This is arguably an asset class Okay, but it's also
a strategy.
I'm covering it up.
Speaker 2 (21:04):
I saw it already.
Speaker 1 (21:05):
I think tax liens are an option.
Okay, it's kind of awholesaling type deal.
It's using leverage in acreative way.
So, for those that don't know,people default on their property
taxes all the time and theseproperties are listed for sale.
There's a whole process forthis.
There's a whole industry forthis, but I think, as a strategy
(21:26):
, your IRA that may not have alot of value yet and you're
trying to get some traction todo some bigger deals.
We have clients that have mademillions over their career using
their IRAs to tie up tax liensand then sit on it, resell it,
have them default, pick up theproperty for the value of the
(21:46):
tax lien.
There's all these differenttechniques involved, but I don't
know, could that be considereda bonus?
Will you give it bonus status?
Speaker 2 (21:53):
I give that bonus status.
We didn't talk about that one,but that's a good one.
We even had at ourself-directed IRA summit we did
in North Carolina.
We had one of the investorsthere who uses Roth IRA to get a
tax lien on a property rightacross the street from Augusta,
Georgia.
Speaker 1 (22:10):
Remember this oh yes, that's right.
Wasn't that where the Mastersis?
Yeah, the golf course inAugusta.
Speaker 2 (22:15):
Yeah and had over a million dollar return on it.
And in that episode he wentover how he did it and he's a
tax lien investor.
I mean, that's what this guydoes.
He does tax lien deals all thetime which, where you go buy,
(22:38):
when someone doesn't pay theirproperty taxes, the cities and
counties will go sell theproperty tax that's owed and so
you can buy that and pay off thecity, basically, and you take
that lien right.
Well, if that and this is alldifferent between the states but
if that owner of that propertydoesn't resolve that with you
and pay you back within acertain period of time, you can
basically foreclose and take theproperty.
And so there's a lot of peoplethat just invest in tax liens,
frankly hoping that peoplearen't going to pay them off.
And if they do, they have topay back with interest.
Speaker 1 (22:58):
So you get some protection there, yeah.
Speaker 2 (23:00):
So, but in this one he found a really sweet deal.
Now, when he found that reallysweet deal, he's like I'm using
my Roth IRA for this, becausenot only am I going to make
money on this deal, I'm going tokeep it all.
So this is is again the realestate investors I know many of
you might be listening that arelike guys I know real estate
investing and you guys, you knoware idiots talking about the
strategies, like I'm.
Speaker 1 (23:21):
you know this is what we're talking about.
Speaker 2 (23:27):
This is a little one-on-one, I know, but just
think about using your Roth forit.
Okay, that's where we've seen Imean honestly, my clients that
have over a hundred million in aRoth IRA.
There's a few, they're all realestate investors, all of them
and but they do it outside theirretirement account.
When they see a home run dealor where they're really trying
to compound over time, they'reusing their particularly their
Roth account.
Speaker 1 (23:44):
Okay, I have one more bonus.
I didn't write it down becauseI didn't want you to see it.
You'll cheat right.
This bonus you're going to love.
Double bonus, double bonus,okay, all right.
If you find this fascinating atall and are, like I, love
creative deals, we need you atthe Alt Asset Summit.
It is later this month.
October 16th and 17th Scottsdale, Arizona, and you can hang out
(24:06):
with creative people that arethinking about this every day
and in their sleep, losing sleepat night, because they are
looking for creative deals intheir IRAs.
So the Alt Asset Summit iswhere you need to be.
It's going to.
Who doesn't want to be inScottsdale in October?
I mean, that's like a nobrainer.
It's the best time, yeah, soit's going to be beautiful.
You can get toaltassetsummitcom.
Please check it out.
(24:28):
You can also watch it online.
We've got probably 15 differentspeakers 're going to parade
through.
Speaker 2 (24:33):
Yeah, incredible list of speakers.
So you can learn about stufffrom storage.
We talked about that.
We've got commercial realestate multifamily people
converting, differentsyndication.
We've got oil and gas a coupleof different speakers on oil and
gas.
We have precious metals.
We'll be talking about crypto,private equity, venture capital
I mean pretty much any assetclass that you can invest in
(24:56):
besides the stock market.
We feel like there's plenty ofevents and stuff you can learn
about investing in the stockmarket not our, not our jam, but
all these different alternativeassets that you can actually
own with an IRA as well We'll betalking about.
And the best thing, too, islike and talk to people who are
already doing that.
You know, learn from them whatthey've learned, because in any
(25:16):
asset class, you can make a badinvestment and a dumb investment
, so being able to network withthose other investors and being
there in person is supervaluable.
They blaze the trail.
Did I get bonus status on thatone?
That was triple bonus.
I'll give you, you know, I'llgive you, I'll give you a double
bonus on that I was just at thecasino a couple of weeks ago.
Speaker 1 (25:31):
That means something.
Speaker 2 (25:32):
Yep, that means something, yep, that does you
know when?
Speaker 1 (25:33):
you get the double, triple bonus.
That's what it means 20 bucks,yep, yep.
Go, turn in that ticket.
You know I miss the days whenyou actually had coins.
You know it's all paper now.
You know it's not as excitingwhen you hold that little bucket
under the slot machine.
Speaker 2 (25:48):
You want to walk out of there with a big gulp full of
.
Is that what you were?
Speaker 1 (25:52):
Maybe, maybe you know , it's all about the feeling I
won $4.
Owen Nichols I'm rich, allright.
Well, everybody, thank you forbeing here today.
Another amazing Directed IRApodcast helping you build your
wealth, invest in what you know.
And people continue to.
What's our dream on?
Live on.
Speaker 2 (26:10):
Stay calm.
Self-direct on.
Speaker 1 (26:12):
Dream on is like.
Speaker 2 (26:13):
is it like a Guns N' Roses song or something Dream?
Speaker 1 (26:16):
on dream on.
No, that's not Guns N' Roses.
No, that's Rolling Stones.
Speaker 2 (26:22):
Oh, yeah, yeah, I think you're right.
Speaker 1 (26:23):
Yeah, there we go.
Speaker 2 (26:24):
What we're saying is stay calm, self-direct on See
you next week.
Speaker 1 (26:27):
Hold it before we say goodbye Aerosmith.
Speaker 2 (26:36):
We just had a correction in the studio.
Yes, that is how we're do not?
Speaker 1 (26:39):
Yeah, we are committed to providing accurate
information on this podcast,aerosmith.
Only direct information, forself-directing only.
Anyway, thanks for me.
See you next week.
And thank you everyone forlistening to a quick disclaimer
and reminder this presentationdoes not constitute an attorney
or CPA client relationship andit is always in your best
interest to consult competentlegal and tax professionals when
(27:02):
conducting your own personaltransactions.
Speaker 2 (27:05):
We also want to make sure you know this is not
investment advice or financialadvice.
We're just trying to give youeducation, ideas and strategies
you can take to yourprofessionals or conduct your
own research on.
We'll see you next time.
Welcome to the Directed IRA Podcast.
My name is Mark Kohler.
I'm here with the amazing MattSorenson on a topic today that I
just think is super powerfuland many of you may have not
heard of these strategies.
Five creative real estate Idon't know.
Acquisition strategies what doyou call them?
Speaker 2 (00:26):
Yeah, I think there's just five strategies you should
be using with an IRA whenyou're investing in real estate.
Some of you might be like yourIRA can own real estate.
Yeah, and we're going to talkabout some common ways.
We've seen clients structuredeals to acquire properties that
you probably haven't eventhought of.
Yeah, and I think many of us.
Speaker 1 (00:44):
When you grow up I did, and it's like you're going
to buy real estate.
You walk down to the bank, youget a mortgage, you buy a house.
You know it's just like.
That's how it works, oh my gosh.
Well, stay up late night andwatch Plastic Magic on TV and
all these creative acquisitionstrategies that people use to
buy real estate.
Well, many of them you can usein your self-directed IRA.
(01:04):
How can I take my self-directedIRA and make money in real
estate?
Well, we're going to share fivestrategies with you today.
I think it's going to be a lotof fun, but we got to get off
the table first.
Asset classes are notstrategies.
Speaker 2 (01:18):
Yeah, yeah, like a buy and hold.
Long-term rental is not astrategy.
That's an asset.
You're owning this property buyand hold.
But we want to talk about theacquisition strategy to get that
property, maybe, or some of thedeals you can do around it,
from your IRA.
So that's first, and that'seven like the first deal I ever
did with my own retirementaccount, which is buying, a buy
(01:39):
and hold rental.
Speaker 1 (01:40):
Yeah, I love it, so some of these, I'll just write
off a few short-term rentalrental yeah, I love it, so some
of these, I'll just rat off afew Short-term rental.
Long-term rental storage units,commercial property, water
rights, fix and flips.
Fix and flip.
Those are acquisitions in thereal estate lane but they're not
(02:01):
the strategy to get that asset,and that's oftentimes the
hurdle.
We see something we want, wejust don't know how to get it.
Speaker 2 (02:06):
Let me explain what we're talking about here.
We say the acquisition strategyis well, I just have, you know,
300 grand in my account, in myIRA account, and I'm going to
buy a $300,000 property.
Okay, your acquisition strategyis just to use the cash in your
account to go buy that, whichis one strategy and that's cool.
It's not a creative one.
We're going to hit somecreative ones Now.
We've had there's probably aclient every hour to doing a
(02:30):
deal with that, with their IRA,in that way, in cash, which is
fine.
But we want to go over somecreative strategies that many of
you might've thought oh, Ican't use my IRA for that Cause
you weren't thinking of thecreative strategies in real
estate.
Speaker 1 (02:42):
Okay, well, I like let's kick it off with that as
our kickoff.
So if you're going to buy that$300,000 property with cash, all
right, that's cool.
Not too creative.
There's pros and cons to thatmethodology, but a creative
strategy would be I'm going tobuy two properties of 300 grand
each and I'm going to get, let'ssay, seller financing.
(03:02):
I'm going to put down 150,000and have the seller carry the
paper on the $150,000.
And now I can buy twoproperties, still cash flow, get
a better ROI in the long runand have more leverage for more
equity build, and that'screative.
Speaker 2 (03:19):
I love that.
That was a great example rightout of the gate.
And let's say that the sellerwon't negotiate seller financing
.
Well, what can you do?
You can get a new bank loan,even all right, there are
non-recourse lenders that willlend your IRA money to buy real
estate, particularly on a buyand hold property.
I've done that.
That was the first deal I did.
I just had a bank lend me moneyon that property.
Speaker 1 (03:39):
Well, that's funny, because the first one I did was
a seller finance, yeah, and thefirst one you did was more of a
bank a non-recourse loan bank,yeah, so, um, now there's rules
on this.
Speaker 2 (03:50):
Of course, when you're getting debt, whether
it's seller financing, you'regetting a new loan, you can't
personally guarantee the debtand we've got a lot of other
podcasts and videos aboutself-directed IRA rules and
prohibited transactions.
But just know that's a ruleWhenever you're getting debt on
a deal, whether it's sellerfinancing or a new loan, don't
personally guarantee it.
Okay, that'll violate the rules.
Speaker 1 (04:10):
Yeah, now, staying in the same genre of financing,
there's also a third option andthat's buying a property subject
to.
I'm not going to ask the sellerfor financing, I'm not going to
go get a new non-recourse loanwhen we have lenders lined up
for you to choose from if you'dlike, but there may already be a
loan on the property and theseller's like I got to get out
of this thing.
(04:30):
If you'll just assume thecurrent mortgage and it's got to
be that non-recourse format,you can't go sign on it
personally, but there might be aproperty with lending already
on it and you can buy theproperty subject to that loan,
and that's another way to getyour IRA in a deal when it may
not have enough money due tocash flow.
Speaker 2 (04:49):
Yeah, and this is when we've seen a lot of clients
get into with a lot of hardlyany money down because they
could be putting maybe 5,000,$10,000 down.
Maybe there's some improvementcosts or some things that need
to improve the property beforeit's rent ready, but they're
coming out of pocket a lot less.
So some people might be doing adeal for $25,000 or less where
they're acquiring the propertysubject to.
(05:11):
Another thing we've seen onsome of these, and an incentive
for this in acquiring theproperty subject to, is a lot of
people are trying to sell ahome and they got some value.
They can't get out of it, butit's got an incredible rate on
it.
It's at a two and a half or 3%mortgage rate and being able to
acquire that property subject tothat mortgage makes it a very
(05:34):
valuable property in terms of arental, because now your costs
to hold it are very low.
You can get better cashflow onit.
So this is one where we've seena lot of savvy real estate
investors use it.
Of course, you can use thesubject to strategy outside of a
retirement account, but alsoyou can use it with your IRA.
Go buy that deal, get thatproperty.
It takes probably a little bitof money down, maybe some money
(05:55):
to improve it, but you just takeover the existing mortgage.
It's called a subject tostrategy.
Speaker 1 (06:00):
Well, I love it.
Now.
I I just as an aside, I don'twant to be offensive today, but
you look a little stuffy.
I I brought a little party.
You know, after 12, you go twobuttons down, you know, did you?
Speaker 2 (06:13):
did you bust that button or is it just optional?
That was, that.
Was, that was intentionally.
Speaker 1 (06:17):
Yeah, I was watching John Travolta last night late
old show and I just I think weneed to bring this back.
You know, just let's let thatsecond button go.
Speaker 2 (06:27):
Mark's a married man, so you know.
Speaker 1 (06:28):
Patty, just you know, she, you know she's like show a
little skin bro.
Speaker 2 (06:32):
Yeah, you got it.
Speaker 1 (06:36):
If you've got a convertible drive at the top
down, exactly.
I mean, it's just the way itworks, yeah, so all right.
So okay, number two I'm tryingto keep you interested in a
typically a very boring topic.
But no, we bring it with some.
This is dinner and a showpeople.
Okay, number two.
Now these are creativestrategies in the real estate
industry to make money with yourIRA.
(06:57):
One of them is wholesaling.
It's that same $300,000property but you only have
$30,000 in your IRA and you'relike, man, that is an awesome
property, 300 grand.
I can't buy it with cash.
I don't have enough money toget lending.
I'm going to just tie it up.
I'm going to make an offer thatI'm going to buy it for 300
(07:17):
grand with a $30,000 downearnest money agreement.
But I can assign the contractbecause I think it's worth 350
and I can go shop it and sellthat.
Maybe make sure your earnestmoney is refundable if you can't
shop it in time.
But that's called wholesaling,where I'm going to tie up a
property and pretty much flipthe contract or the opportunity
(07:39):
to buy it for 300.
We've had clients make hundredsof thousands of dollars.
Speaker 2 (07:44):
Yeah, and it could even be a $5,000 amount that you
do need to pay something fromthe IRA to tie it up, right,
there's some legalities to that.
But now, if that property isworth 330 and there's other
investors that would want to buyit, if you're able to find the
deals and this is where, again,if real estate's what you know,
and some of you already in dowholesaling by the way, I know
(08:05):
some of you already dowholesaling.
They're listening to this.
They're like guys, I know thestrategy.
You didn't explain it very well.
I'm like, yeah, but do it withyour IRA.
Why would I do that with my IRA?
Well, let's do a Roth IRA.
Okay, let's say your Roth IRAputs five grand down on this
wholesaling deal and let's sayyou make 20 grand on that.
That 20 grand goes back intoyour Roth IRA, no tax and coming
out totally tax-free atretirement.
(08:26):
If you do that wholesaling dealoutside your IRA, it's going on
your 1040, ordinary income, allright, it's going to be your
regular rates plus state tax.
So a lot of times thesestrategies, if you couple it
with the self-directedretirement account, it becomes a
really good tax play.
Oh, you put it on steroids,yeah, and wholesaling would be
one.
(08:46):
You know there's anotherversion of wholesaling that is
like real estate developers use,which are options where they'll
get land under option contracts, do some pre-development work
and then they'll sell it for abig premium.
We've had clients make over amillion dollars selling options
with their Roth IRA where thatvalue that they can create on it
, either through a hold periodor some paper development type
(09:07):
stuff, can have a million dollarplus return back into the Roth
IRA, no tax.
Now you could have done thatoption deal outside of your
retirement account but you wouldhave paid Uncle Sam and your
state.
You know these silent partnersthat want a piece, you know.
But if you want to keep it all,I'm just saying, use the Roth
IRA.
Speaker 1 (09:25):
I love it.
All right, that's strategy two.
Do you want to throw down?
Speaker 2 (09:27):
three, yeah, I like three.
This is what I do the most, andthis is being the lender on
deals.
So think of yourself as thehard money lender the bank, you
know, the mob, whoever you know.
When someone needs money, yourretirement account can fund that
, you know.
Speaker 1 (09:47):
Yeah, we're promoting mob strategies here, so I think
it's an exorbitant interest.
I know Matt.
Speaker 2 (09:59):
Every good mafia movie you know with the mob has
somebody that lent money andthey got behind and someone's
getting their knee broken.
Speaker 1 (10:02):
That's part of every mob.
Speaker 2 (10:03):
Show you're right I'm just trying to relate, you know
.
Speaker 1 (10:05):
Yeah, yeah so and this is again a very common
strategy in the in real estateindustry, but people don't
realize my ira could be doingthat same deal and if you're
doing 12 and 2 for some of youthat are in the business know
that that's a 12% annualinterest rate and two points and
(10:26):
if you can flip that loan twicea year, doing short-term loans
for real estate developers or-.
Speaker 2 (10:32):
Flippers or any real estate investor that needs
capital.
I mean, that's what I'm doingright now, and I know you guys
have done some private moneylending too.
It's just a good way to get agood return on your retirement
account right.
If I'm getting 12% plus twopoints on six-month loans, I get
the two points twice a year.
That's four plus 12.
That's 16% annual rate ofreturn.
(10:54):
Now you get a lien on theproperty right First trustee.
Turn Now you get a lien on theproperty right First trustee.
Right First trustee.
You might be in second Ifthere's enough equity in the
deal.
You want to be careful Don't dobad loans to people that don't
know what they're doing orproperties that don't have
equity right.
So, but that's a great strategywhere you can access deals but
you don't have to run the deal.
You don't have to be like theperson that goes that, finds
that wholesale deal or thatoption property that negotiates
(11:16):
that subject to or sellerfinancing deal, and so this is a
little more of a passive play,but it's creative in the sense
that you're using yourretirement account and I had one
.
I remember I talked to oneclient.
He's got a seven figure plusaccount, and when he heard about
real estate investing.
He was a real estate investor.
He was like he just got so hungup on all the tax things.
(11:38):
He's like I don't want to ownreal estate.
He's like I'm just going to doprivate lending and I remember
him talking about that becausehe did private lending
personally.
And he's like Matt when I lendmoney private, it's interest
income to me.
I'm at a 30% federal tax bracket.
I'm at like 8% in my state.
When I make a hundred thousanddollars on lending my personal
money, I really only made$55,000 because of my federal
(12:00):
and state taxes that eat up intothat.
Once I learned I could do thiswith my retirement account and I
make a hundred grand ininterest, I kept a hundred grand
and he's like it's been insanethe amount of compounding growth
.
If I look at my bucket of moneythat I lent, that I've always
been lending for and I've beenlending on a longer period of
time but on my taxable moneythat hits my 1040 versus my
(12:23):
bucket of money in my retirementaccount that I lent out and he
has a Roth that I get to keepevery penny he's like it's
insane how much this one hascompounded more of the last 15
years.
Yeah.
Speaker 1 (12:32):
Yeah, he had me at Roth, thank you.
Speaker 2 (12:34):
You're welcome.
Speaker 1 (12:35):
Yeah, don't say another word.
Okay, renee Zegler.
Okay, now number four, and thisis one of a strategy I've had
several clients do throughout mycareer.
I've seen it.
I would like to see it more.
I think it's a really coolstrategy.
I can guarantee nine out of 10of you listeners have not heard
of this strategy, and I call itthe Roth dream home takeover.
(12:58):
All right, now what this isabout.
We had a couple I love yourbranding.
Speaker 2 (13:04):
You're like branding.
Are you going to trademark that?
Damn straight.
Speaker 1 (13:08):
Not to be used without the express written
consent of Mark J Kohler and theNFL.
Okay, so now on this takeover.
Okay, and let me throw this out.
I'll tell you the strategy andthen a little story.
It is looking down the roadfive to 10 years and saying
that's where I want to live,that's where I want my dream
home.
I'm going to retire at 59 and ahalf later and I want to be in
(13:31):
Boca Raton, I want to be inAspen, I want to be in this
beautiful area.
But, holy crap, 10 years fromnow, anything I want now is
going to be twice as much then.
And how am I going to afford it?
It's not going to happen.
And so you have this dreamlocation, this dream property
that you want to be at when youretire.
How you get there?
(13:52):
Well, I've had several clientsfind that property now, when a
deal comes, because they can'tmove now.
But the opportunity comes.
So they're ready and they buythe property in their Roth IRA
with maybe the subject tostrategy, the seller financing
strategy, the non-recourse loanstrategy, whatever.
(14:13):
But they find this property andthey buy in the name of their
Roth IRA.
Okay, can you move into itright now?
No, that would be a prohibitedtransaction.
You can't live in your IRA'sproperty.
But they buy it now and thenthey take all the cashflow from
that.
They short-term rental it, theylong-term rental it.
They know they're going to bethere someday and they want to
(14:33):
do a rehab.
They're so excited when theycould go in and put in their own
furniture and paint new carpet.
But for now it's just going tobe a rental property.
But it's the place they want tobe and they let the Roth IRA
own it and take all the cashflowand pay off that mortgage as
fast as they can.
59 and a half comes along, 60,62, whatever.
(14:53):
And that time comes to load upthe U-Haul and go you can call
it directed IRA and go.
Will?
You just deed me that propertyTax-free, no tax at all.
All the equity growth, all thatcashflow paying down the
mortgage, any equity in that,the Roth IRA value itself goes
to you tax-free, no penalty,nothing.
(15:16):
And if there's still a mortgageon it, fine, pick up the
mortgage.
You can go in and rehab it,make it a fresh for you.
So you're locking down inadvance the property you want to
live in down the road andletting your Roth IRA hold it
for you and you're going to takeit over when the time's right.
Speaker 2 (15:32):
I love it.
Now, pen drop yeah, I love that.
That's as you explained itright.
There is the way to do it.
Now keep in mind when thatasset is coming out after 59 and
a half, there's a reason.
Mark said that that's when youcan take money out of your Roth
IRA or assets tax-free.
So here we're not selling theproperty and taking cash out.
(15:54):
You want to use the property.
You like the property.
That was the reason you boughtit.
That was one of the vision youhad in the future.
So what we do is we get anappraisal of the property to set
the value and then that valueis distributed out to you.
Now the key thing Mark used wasa Roth IRA, because when we're
distributing that Roth IRA assetout to you, there's no tax on
(16:15):
it.
But I'll give you an example.
I had a client who called me upand he had bought this property
.
It was in Florida.
I don't remember where.
It was, not Del Boca Vista, itwasn't.
It was not, but Morty Seinfeldwasn't involved or anywhere.
It's a little Cadillac, it's agolf cart, okay, but he did buy.
(16:39):
I remember when he told me hesaid I bought this in my IRA and
he's wanted to move into it.
And he said I bought this inthis area because I had stayed
there with friends that had aplace in the same place and my
wife and I fell in love with it.
We saw the real estate goingoff the charts here.
We thought let's go buy one,let's lock it in, let's lock it
in.
And he said I just did it withmy IRA and he had actually just
short-term rental.
(17:00):
Okay, now he wasn't using it,all right, but they had that
vision you were talking about ofman.
When we quit the day job, wewant to come at Del Boca Vista,
all right, playing cards withMorty Seinfeld man how would it?
be.
So now here was the snag.
(17:22):
He had a traditional IRA.
Okay, this was done as atraditional account, and so it
was interesting because thatproperty was actually doing
pretty well as a rental.
He was actually making goodcashflow.
So we weighed the pros and consof him distributing it out.
What was it worth?
Now it had gone up in value, itwas cashflowing great as a
(17:44):
rental, and what he actuallydecided to do was just to buy
another property in the samedevelopment personally, because
that property was performingwell in terms of cashflow and it
was still growing, and hedidn't want to take the hit for
the traditional.
So the key was if you feel likethat play is going to be, that
(18:04):
area or place where you want tobe in 510, whatever that window
is is appreciating, it's goingto be a hot market.
You definitely want to use theRoth IRA, so it comes out tax
free.
Yeah, and here's the workaround, everybody.
Speaker 1 (18:15):
Do the chunk.
Take the Roth conversion earlyon because you could get an
appraisal.
This couple could have beenback when they first bought it
and they knew it was going tohighly appreciate it.
Get a valuation with anappraiser.
Tell them I want the lowestpossible value, which is not
what appraisers are typicallytold.
And say I want the lowest value,you can justify it, roth
(18:37):
conversion that you can standbehind, and then Roth conversion
, so rip the Band-Aid off back,then pay the tax on that
property value.
Then in that five to 10 yearrunway they pull the trigger
Exactly Yep, no tax, yep, so fun, fun, fun strategy.
Speaker 2 (18:54):
Okay, number five All right, let's talk about
partnering.
Yeah, partnering.
I think this is a reallypopular one.
As a lawyer, I probably set upover a thousand LLCs with
someone's IRA in the LLC as apartner.
There's a lot of variations ofhow this could look.
This could be a combination ofIRAs partnered together in an
LLC.
This could be your IRA, yourspouse's IRA, your kid's Roth
(19:16):
IRA, your health savings accountall into one LLC going to do a
real estate deal.
Whatever that asset class is inthe real estate space.
Maybe it's a storage facility,maybe you're flipping a property
any of this other stuff we'vetalked about.
Another variation could be andwe've said this one quite a bit
is maybe your IRA is like thecash partner in a deal and
there's some other investorwho's like the work partner, you
(19:38):
know, and you have a splitpercentage of ownership and a
credit partner.
Yeah, you could even have acredit partner in the mix too,
if needed, in the deal.
So, and we could go on withdifferent iterations of that,
and maybe you would like to, butI was going to say there's a
lot of variations of how thatcould look.
Speaker 1 (19:54):
And we've got some great podcasts that are on folks
.
If that's already entertainingto you, get over and check out
those podcasts on the IRA LLC.
And the one I'd like there themost is a college savings type
angle.
You're doing real estate,you're in the real estate realm.
You're like, oh, I can do this.
And they do have children thatare 5, 10, 15 years old.
(20:15):
You know they're going tocollege in 5 to 10 years.
You're like, but you don'tthink and say you know what, I
can put their covered LIRA inthis mix.
Just throw in two grand intheir covered LIRA or a couple
grand for double up a couple ofyears if you can Get your kid's
Roth IRA going even.
And so now you're using astrategy for some exit on this
(20:38):
property 5, 10 years from nowwhen your kids are going to
college and their covered LRAcould come out tax-free for
college.
And it's just a 1% owner.
It doesn't have to be a lot.
Speaker 2 (20:49):
It's base hits, yeah.
Base hits win games yeah.
Speaker 1 (20:53):
All right, now I'm going to throw in a bonus.
I got a bonus.
Speaker 2 (20:55):
Oh, all right, Now I'm going to throw in a bonus.
I got a bonus, oh, all right.
I'm curious what this is.
All right, here's a bonus.
Speaker 1 (20:59):
This is arguably an asset class Okay, but it's also
a strategy.
I'm covering it up.
Speaker 2 (21:04):
I saw it already.
Speaker 1 (21:05):
I think tax liens are an option.
Okay, it's kind of awholesaling type deal.
It's using leverage in acreative way.
So, for those that don't know,people default on their property
taxes all the time and theseproperties are listed for sale.
There's a whole process forthis.
There's a whole industry forthis, but I think, as a strategy
(21:26):
, your IRA that may not have alot of value yet and you're
trying to get some traction todo some bigger deals.
We have clients that have mademillions over their career using
their IRAs to tie up tax liensand then sit on it, resell it,
have them default, pick up theproperty for the value of the
(21:46):
tax lien.
There's all these differenttechniques involved, but I don't
know, could that be considereda bonus?
Will you give it bonus status?
Speaker 2 (21:53):
I give that bonus status.
We didn't talk about that one,but that's a good one.
We even had at ourself-directed IRA summit we did
in North Carolina.
We had one of the investorsthere who uses Roth IRA to get a
tax lien on a property rightacross the street from Augusta,
Georgia.
Speaker 1 (22:10):
Remember this oh yes, that's right.
Wasn't that where the Mastersis?
Yeah, the golf course inAugusta.
Speaker 2 (22:15):
Yeah and had over a million dollar return on it.
And in that episode he wentover how he did it and he's a
tax lien investor.
I mean, that's what this guydoes.
He does tax lien deals all thetime which, where you go buy,
(22:38):
when someone doesn't pay theirproperty taxes, the cities and
counties will go sell theproperty tax that's owed and so
you can buy that and pay off thecity, basically, and you take
that lien right.
Well, if that and this is alldifferent between the states but
if that owner of that propertydoesn't resolve that with you
and pay you back within acertain period of time, you can
basically foreclose and take theproperty.
And so there's a lot of peoplethat just invest in tax liens,
frankly hoping that peoplearen't going to pay them off.
And if they do, they have topay back with interest.
Speaker 1 (22:58):
So you get some protection there, yeah.
Speaker 2 (23:00):
So, but in this one he found a really sweet deal.
Now, when he found that reallysweet deal, he's like I'm using
my Roth IRA for this, becausenot only am I going to make
money on this deal, I'm going tokeep it all.
So this is is again the realestate investors I know many of
you might be listening that arelike guys I know real estate
investing and you guys, you knoware idiots talking about the
strategies, like I'm.
Speaker 1 (23:21):
you know this is what we're talking about.
Speaker 2 (23:27):
This is a little one-on-one, I know, but just
think about using your Roth forit.
Okay, that's where we've seen Imean honestly, my clients that
have over a hundred million in aRoth IRA.
There's a few, they're all realestate investors, all of them
and but they do it outside theirretirement account.
When they see a home run dealor where they're really trying
to compound over time, they'reusing their particularly their
Roth account.
Speaker 1 (23:44):
Okay, I have one more bonus.
I didn't write it down becauseI didn't want you to see it.
You'll cheat right.
This bonus you're going to love.
Double bonus, double bonus,okay, all right.
If you find this fascinating atall and are, like I, love
creative deals, we need you atthe Alt Asset Summit.
It is later this month.
October 16th and 17th Scottsdale, Arizona, and you can hang out
(24:06):
with creative people that arethinking about this every day
and in their sleep, losing sleepat night, because they are
looking for creative deals intheir IRAs.
So the Alt Asset Summit iswhere you need to be.
It's going to.
Who doesn't want to be inScottsdale in October?
I mean, that's like a nobrainer.
It's the best time, yeah, soit's going to be beautiful.
You can get toaltassetsummitcom.
Please check it out.
(24:28):
You can also watch it online.
We've got probably 15 differentspeakers 're going to parade
through.
Speaker 2 (24:33):
Yeah, incredible list of speakers.
So you can learn about stufffrom storage.
We talked about that.
We've got commercial realestate multifamily people
converting, differentsyndication.
We've got oil and gas a coupleof different speakers on oil and
gas.
We have precious metals.
We'll be talking about crypto,private equity, venture capital
I mean pretty much any assetclass that you can invest in
(24:56):
besides the stock market.
We feel like there's plenty ofevents and stuff you can learn
about investing in the stockmarket not our, not our jam, but
all these different alternativeassets that you can actually
own with an IRA as well We'll betalking about.
And the best thing, too, islike and talk to people who are
already doing that.
You know, learn from them whatthey've learned, because in any
(25:16):
asset class, you can make a badinvestment and a dumb investment
, so being able to network withthose other investors and being
there in person is supervaluable.
They blaze the trail.
Did I get bonus status on thatone?
That was triple bonus.
I'll give you, you know, I'llgive you, I'll give you a double
bonus on that I was just at thecasino a couple of weeks ago.
Speaker 1 (25:31):
That means something.
Speaker 2 (25:32):
Yep, that means something, yep, that does you
know when?
Speaker 1 (25:33):
you get the double, triple bonus.
That's what it means 20 bucks,yep, yep.
Go, turn in that ticket.
You know I miss the days whenyou actually had coins.
You know it's all paper now.
You know it's not as excitingwhen you hold that little bucket
under the slot machine.
Speaker 2 (25:48):
You want to walk out of there with a big gulp full of
.
Is that what you were?
Speaker 1 (25:52):
Maybe, maybe you know , it's all about the feeling I
won $4.
Owen Nichols I'm rich, allright.
Well, everybody, thank you forbeing here today.
Another amazing Directed IRApodcast helping you build your
wealth, invest in what you know.
And people continue to.
What's our dream on?
Live on.
Speaker 2 (26:10):
Stay calm.
Self-direct on.
Speaker 1 (26:12):
Dream on is like.
Speaker 2 (26:13):
is it like a Guns N' Roses song or something Dream?
Speaker 1 (26:16):
on dream on.
No, that's not Guns N' Roses.
No, that's Rolling Stones.
Speaker 2 (26:22):
Oh, yeah, yeah, I think you're right.
Speaker 1 (26:23):
Yeah, there we go.
Speaker 2 (26:24):
What we're saying is stay calm, self-direct on See
you next week.
Speaker 1 (26:27):
Hold it before we say goodbye Aerosmith.
Speaker 2 (26:36):
We just had a correction in the studio.
Yes, that is how we're do not?
Speaker 1 (26:39):
Yeah, we are committed to providing accurate
information on this podcast,aerosmith.
Only direct information, forself-directing only.
Anyway, thanks for me.
See you next week.
And thank you everyone forlistening to a quick disclaimer
and reminder this presentationdoes not constitute an attorney
or CPA client relationship andit is always in your best
interest to consult competentlegal and tax professionals when
(27:02):
conducting your own personaltransactions.
Speaker 2 (27:05):
We also want to make sure you know this is not
investment advice or financialadvice.
We're just trying to give youeducation, ideas and strategies
you can take to yourprofessionals or conduct your
own research on.
We'll see you next time.
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