Down Payment Question

[Aaron Harwood]

My wife and I currently own a rental property (our old house when we moved). We make some money on it, but not a whole lot. We are interested in investing in some more property and having those be rentals as well. Obviously since we are purchasing it as an investment we need to put 20%-25% down. 

We don't have a that much savings sitting around to put $20k down. All our money is in retirement funds. So I was wondering what those of you did when first starting out purchasing your first few investment properties? How/Where did you come up with the money? Also, is it smart to pull it out of a 401k? 

Any information is much appreciated!

Thanks!

[Devin Haertling]

I also have heard of rolling your IRA into a self directed IRA.

I understand there are risks as mentioned but if you buy the right property it is like owning a blue chip stock with a good paying dividend.

You own a house that presumably won't lose value and you get to collect rent each month while keeping the value of your initial investment.

Think about an IRA. When it's time to cash it out you sell your holdings and spend the money. After 10 years your nest egg of money is then smaller than it was. Why not use that money to buy real estate that will give you steady income while keeping your initial investment intact.

I know the real estate market can crash as it had in the past but if your property stays rented then you're still cash flowing well