Self Directed IRA - Accessing for funding deals

[Richard Lindman]

Hello BP,

Because of the rules, it is not possible for the owner of a Self Directed IRA to loan money to their LLC's. It would be considered a prohibited transaction.

My solution is to find other investors with a Self Directed IRA who are in the same position. At a high level, the transaction would look like this:

Investor A loans money to Investor B from their SDIRA.

Investor B loans money to Investor A from their SDIRA.

Both loans have the same terms, backed by the real estate of each borrower.

I have confirmed that this is type of arrangement does not violate the rules governing SDIRAs.

Is anyone else in BP using this strategy?  If so, I would appreciate your hearing your experiences.  

Thanks,

Richard