How Can Your Clients Use Their IRA Funds To Invest in Real Estate

Brandy Mercier's picture
Investing in Real Estate with Roth IRA

While trying to blend my stock broker background with my new real estate career, I have learned of a service to offer your retired clients.

The self directed IRA allows your clients to use their IRA funds to invest in real estate. There are companies which can be hired as the custodian of your clients IRA. This means they hold the money until it is time to wire the funds to pay for the property.

The asset is owned by the IRA and there is a fee of $650 a year for my account of $300,000. I decided to try this out before I recommended it to my clients.

I have researched two companies so far, Equity Trust Company who E*trade recommended. I currently have all my accounts with E*trade. I also went to Pensco to interview them because they have an office an hour from me in Portsmouth, N.H. Equity Trust was a little bit cheaper maybe $50 less and was not so restrictive but still followed IRS rules.

Basically you can purchase a property inside your IRA with cash and rent it out to earn income. Here in N.H. rental income can earn 6.5% on your investment of $300,000. I sleep better at night investing in real estate and not the stock market. Your client can not actively participate in the property and that's another service you can offer, renting out the property or managing it. If you want to learn more just google Self Directed IRA's.

I will do a follow up blog after I have closed on the property.

Brandy Mercier
Real Estate Agent / Amherst, NH
Keller Williams Realty Inc.
Mobile (603) 325-2952


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