Using Loan From Parents To Get Investment Loan

[Matthew Vorce]

I am looking to jump start my real estate investment by receiving a loan from my parents. I am looking for advice on the best way to proceed with this. Things that I am concerned about:

I want this to be a loan and not something the IRS will try to tax me on.

I have heard that if it is a gift I will be able to use the money right away for mortgages. This worries me because I do not want to be taxed on this money.

If the money sits in my bank account for 60 days, is it safe to assume I should have no problem using it for a loan?

Other issues that I have not thought of...

Example Scenario:

Loan from parents: $100,000 at 7% interest
Use loan as down payment to get a $400,000 investment mortgage on a small apartment complex

Thanks in advance for any advice!