You can pledge some other type of collateral, options being:1. your primary residence2. a certificate of deposit at the institution or another institution3.  

Your collateral for a loan is not the $285K account balance, it is whatever is left after you pay the taxes and penalty for early distribution.

You will need to take it to foreclosure and sell it, and if it doesn't sell, you now have a collateral position.

Cross-collateralizing other properties is not an option because although I have significant equity, all of my investments are leverage at 40-60 LTV so they would be pushed into a second position which doesn't accomplish much in this instance.

Besides the statutory limits, you can get tagged for loss of profits, costs of repairs, moving expenses, living expenses and other collateral losses.

In addition, I do not have any kind of down-payment for a loan, or collateral.

When you purchase a note, it is secured by the collateral property. 

I know of a portfolio lender that will allow cross collateralization and they do have a release clause.

Thank, Jason I would suggest looking into a second position hard money loan.You can also cross collateralize both the second position and the first for the purchase.

After that, you'll be looking at portfolio or commercial loans via cross collateralizing.