Hi all - there are plenty of good reads on the site about the downsides of using hard money, but I haven't stumbled across anything discussing the potential downsides of providing hard money.Aside from the fact that your return is basically capped at your interest rate and the points that you charge, are there any other downsides to providing hard money?

I'm not arguing, just curious . . . do you see a specific downside to it?

Are there any downsides to having the IRS peaking inside my IRA?  

It seems like a very easy way to get into investing, so I was wondering what the common pitfalls and downsides to using a master lease option all the time would be.

The downside to that is the 20 - 25% down required which I don't have right now.

Unless you plan to do the work yourself, there really to me is no material downside to managing the properties yourself. 

The downside to new construction development is the time it is going to take to build the property and having your capital locked up in the deal. 

The downside with these approaches is you do not extract your capital from the property upfront.

I'll wait what others have to say, but I think I will put it on hold on buying my first investment property until I'm home everyday, the down side to this will be financing, when I switch locally the bank might not want to give me a loan since I just started a new job. 

The downside is you will need to live there, for a minimum of one year (to satisfy FHA Requirements); AND because you closed personally, you will not have Asset Protection, in the form of closing in the name of a LLC.