I didn't realize that placing it under property management was in direct violation of the second home loan, so in the middle of escrow, needed to find alternate financing.

c) Exceptions The term ''personal holding company'' as defined in subsection (a) does not include - (1) a corporation exempt from tax under subchapter F (sec. 501 and following); (2) a bank as defined in section 581, or a domestic building and loan association within the meaning of section 7701(a)(19); (3) a life insurance company; (4) a surety company; (5) a foreign corporation, (6) a lending or finance company if - (A) 60 percent or more of its ordinary gross income (as defined in section 543(b)(1)) is derived directly from the active and regular conduct of a lending or finance business; (B) the personal holding company income for the taxable year (computed without regard to income described in subsection (d)(3) and income derived directly from the active and regular conduct of a lending or finance business, and computed by including as personal holding company income the entire amount of the gross income from rents, royalties, produced film rents, and compensation for use of corporate property by shareholders) is not more than 20 percent of the ordinary gross income; (C) the sum of the deductions which are directly allocable to the active and regular conduct of its lending or finance business equals or exceeds the sum of - (i) 15 percent of so much of the ordinary gross income derived therefrom as does not exceed $500,000, plus (ii) 5 percent of so much of the ordinary gross income derived therefrom as exceeds $500,000; and (D) the loans to a person who is a shareholder in such company during the taxable year by or for whom 10 percent or more in value of its outstanding stock is owned directly or indirectly (including, in the case of an individual, stock owned by members of his family as defined in section 544(a)(2)), outstanding at any time during such year do not exceed $5,000 in principal amount;"

I believe Scott is indirectly responding to my suggestion for the DL, I wouldn't worry about it, he's just simply trying to show his presence.

The lawyers I've talked to about this have cautioned that even if your SDIRA gets no direct benefit from involvement from your son they have been going after the undoubted indirect benefit situations and you are playing roulette with your SDIRA by doing these types of transactions.

@Ira BloomfieldThe IRS prohibits any direct or indirect transactions or benefit between an IRA/Solo 401(k) and a disqualified person.You are a disqualified person to your Solo 401(k).If your Solo 401(k) is being used to salvage a transaction that you have engaged in personally, could the IRS not view that as an indirect benefit? 

There can be no direct or indirect transactions or provision of benefit between a plan and a disqualified person (you, spouse, lineal family, entities owned by such).A violation of these self-dealing rules will void the IRA and create significant tax penalties.

It's resulted in direct bookings through my closely held property management company, Josh's Cabins.Lessons learned?

then U have to front the draws  lets say draws are going to come out at 20k per draw.So cash needed to do a typical HML in todays market  for a 250k loan.50k   DP8k    Points2k   3rd party closing costs3k   Lender junk fee's which could include apprasial.20k first draw  then U get reimbursed each draw 2k   per month for your payment @ 12% which is pretty common today many are higher So lets say its a 9 month start to finish you will need another 18k in payments.2k  for utls law mowing etc.Grand total to do a 250k HML would be about 98k in cash  plus some reserves for when the project goes over budget which is quite common.So figure to do a 250k HML on a fix and flip you will need 100k in direct costs up front and 25k in reserves.

I know some of the big names in direct mail have posted a list of their favorite strategies. 

In direct investment, to achieve returns that beat a typical syndication, you will some type of experience or expertise that gives you a competitive advantage over professional active, direct investors.