The financing must be non-recourse and there is a tax implication on the income derived from the borrowed funds (UDFI), but this can be a very powerful means to invest using leverage and achieve a higher cash-on-cash return for your IRA dollars as a result.You  cannot rollover Roth IRA funds into a Solo 401k, although such a vehicle may be of interest to you going forward since you are self-employed.

3) Or convert my $250K+ Rollover 401K into a Self Directed IRA to purchase the unit?

I have a 403b and a pension fund payout that I will be able to roll over into something (what?).

There are several self directed IRA custodians out there that can setup the rollover and manage it for you. 

In order to partner with him he wants me to contribute 1 million to pay off the loan to be a true 50/50 partner on the land so we can develop it.I don't have 1,000,000 in cash lying around so I offered to leverage one of my income producing properties as a lien to the bank which is worth about 1 million.The goal is to roll over his 1 million dollar loan into a 5 million loan which we would share 50/50. 4 million of that would be used to develop the land.He needs my income and assets to qualify for a bigger loan, and I feel like my 1 million of income producing assets would suffice in the form of leverage.The disagreement is that he feels I am not bringing any money to the table in this scenario to make it a true 50/50 partnership.  

@Kathleen Amundsenyou can rollover your 401k into self-directed IRA and buy rental properties with it.

I was wondering whether or not I can rollover my traditional IRA money to the self-directed IRA, so that I can use this money to invest in real estate without paying penalty, right?

Also you should think about using you 401K, if you current employer always a rollover to self-directed.

From what I read if i didn't win my 10k deposit would roll over to the October auction but since I did win will I need a new deposit?

I'm going to make the assumption that I have left my previous employer and can roll over the 401(k) into a self-directed 401(k) because I've started a small business.