How are you SD-IRA guys handling mortgage payments?

[Bryan Scrivener]

I'm closing on my first property in a couple of weeks and sorting out options for making the payments on a non-recourse loan. I was hoping the property manager would handle that before sending any profits back to the IRA but that is not a service they typically offer.

If I have to direct the custodian to pay it every month that will get very expensive fee-wise, not to mention be a pain in the rear. I know forming an LLC so I can do it myself is an option, but that too will add some expense.

I'm curious how people typically handle this?

[Brian Eastman]

@Bryan Scrivener

The cost of establishing a LLC to be owned by your IRA should more than pay for itself in reduced custodial fees going forward. For most investors with a rental home that has a mortgage, you are reducing enough fee interactions that the payback will come in just a few years. Over the life of your investing, you will likely save thousands of dollars by eliminating per-transaction fees, nevermind the headache factor of custodial paperwork and delays.