Non-Recourse Lenders: Debt Financing Overview
If you’re looking for non-recourse lenders to provide a loan for a self-directed IRA real estate investment – also known as debt financing – there are several financial institutions that provide this type of loan. But you must ensure the lender is a “non-recourse loan” lender.
To find an appropriate non-recourse lender, try searching “self-directed IRA non-recourse lenders” or “self-directed IRA (or 401(k)) non-recourse loan,” and you’ll likely find a list of individuals or entities that will lend money to self-directed IRAs and 401(k)s.
As you consider this type of financing, thee are a couple of things you should keep in mind:
- An account can take on a loan to purchase property. The loan must be non-recourse, meaning the only collateral securing the loan is the property being purchased with the loan.
- Other assets held within the account or the account holder personally cannot be held liable in the event of a default on the repayment of the non-recourse loan.
Looking for help navigating the non-recourse lending process? The Real Estate Investing Hub includes resources to support your search for IRA-friendly lenders, plus access to real estate reports, tax services, and other tools to assist with your next purchase.