All Forum Posts by: Emily Refi

Many thanks to all who have chimed in on the topic, I have learned a lot about SD IRAs- this group is amazing! 

I can safely eliminate the SD IRA option for myself for this particular project....however it could be a good "tool" to pull out of the toolbox if I'm working with private money in the future, in which case some of you might be hearing from me. :)

@Michael Plaks thanks for the head's up. I will need approx. 90K for down payment + rehab. I have been planning to use HELOC... however I just learned about the SD IRA so I want to learn more about how to work with it as an alternative.

My contractor is referring me to his neighbor who might be interested in investing ("cash provider") there is always the short term unsecured loan option; but as an option, maybe SD IRA would be beneficial so the earnings could be redeposited without tax exposure.

I'm also wondering if I can convert my traditional IRA to be self-directed to use on this, or future projects.

@Mike Nuss thanks for the advice. I worked with Tom Moore on my 1031 - very happy with the results and good to know he does IRAs as well. And thanks for the head's up. I've never worked with SD IRAs, I just read about them and would like to see if it would be a good route for myself and/or a potential investor - 

Could you please explain the co mingling funds piece, does that mean that the SD IRA would fund the full down payment rather than part?

Has anyone worked with a real estate savvy CPA in Portland, OR? I need a CPA to help with a tri-plex deal. Looking to convert traditional IRA to SD IRA to use for part of a down payment and rehab. Referrals appreciated....thanks!

The "rental property estimator" under "tools" here is an excellent place to start and look at real numbers to evaluate. A 203k loan might be a good choice if you are occupying the property and renting the others, it has a low down payment which would allow you to work on your other debts. Lots to learn but if it saves money on rent while you have an asset appreciating it could be a good thing!

I am about to put in an offer on a tri-plex for short term rentals. I have a contractor who might be interested in investing or partnering in some capacity... contributing 20k toward the down payment and about 25k in repairs for a total of 45k upfront. Assumption is that I carry the mortgage, 595k and also pay about 80k for the rest of the down payment, FF&E and interior updates. 

The options are A) treat the contribution as a loan, with 8% interest, or B) Profit sharing of a certain percent, or C) We partner up with weighted shares... like 20/80 with the understanding that he will provide ongoing maintenance. 

Are there other options, what has worked well for others? And what kind of contract would you use to solidify? I have done a couple of deals, but this would be my first with an outside investor / partner. Thanks!

p.s. - post and pier foundations like yours are easier to level than foundations with concrete slabs. You can pour new temporary footings next to the existing ones in order to jack the beams up to where they need to be, then replace the existing posts with longer ones. Or decommission the old footings with new footings & posts next to them along the beam line (your footings might be undersized for the soil). 

I had a similar situation with a post & beam foundation and it cost about 9k for new footings & to level 4 posts in a crawl space. 

You can fix the building but you can't fix the location :) I would ask for an amendment for additional time due to damage found - seller could say yay or nea. Have a structural engineer look at it, get a quote on repairs & include a contingency to price to cover the unknowns - consider meeting seller somewhere in the middle if you really want it. Foundation leveling can be tricky but not necessarily a deal breaker, this still sounds like a good deal to me. 

For my units on the Oregon coast, each has a wood burning stove, and I provide fluffy bathrobes and down comforters. Not over the top... but creature comforts I would love to see in a vacation rental-- and I'm booked almost every night of the year!