Self- Directed IRA's
I have been usting Equity Trust Co. as custodian for a self-directed IRA, investing in real estate among other things.
They charge $185/yr fee.
I just "googled" for self directed IRA and found a hand fullof companies doing the same thing...Entrust, Pensco, UMB, Calvert, Sterling Trust, Union Bank of CA, Arvest, etc
My question is has anyone used any other company besides Equity Trust, and how did you like it, and what are their fees?
Just a note. I am not dissatisfied with Equity Trust, but am curious what else is out there, and what fees they are charging.
Thanks!
I'm interested in doing the same. 64Ford, how has your experience been with a self directed IRA. Are the additional rules (can't deal with yourself directly, etc) a burden? What types of transactions would you do or not do under your IRA?
-Jeff
I use Entrust. I'm familiar with most of the companies you mention.
As far as I know they are all reputable organizations offering great services for the SDIRA investor. The fees differ so slightly that they get lost in the noise if you are actively investing in real estate through your SDIRA.
I have bought and sold homes and invested in real estate notes through my SDIRA.
However, I have recently decided to move to notes only and am divesting myself of my remaining SDIRA properties.
I have found it far easier to invest in notes and have averaged a 14% annual return doing so. I find investing in homes within my SDIRA to be too cumbersome. This is in spite of the fact that to do residential and commercial investing outside of my IRAs as a business.
It's because of the added complexity of trying to manage to separate (by law) REI businesses. With 14% returns on notes, why bother with the extra grief?
Over the next few years until I retire, I'm looking to become a mortgage banker (small scale) through my SDIRAs and also expand my active REI business using my non-IRA funds for cashflow and building non-retirement wealth
Quote:
On 2004-11-05 16:42, jblackwell wrote:
I'm interested in doing the same. 64Ford, how has your experience been with a self directed IRA. Are the additional rules (can't deal with yourself directly, etc) a burden? What types of transactions would you do or not do under your IRA?
-Jeff
I have had good experience with self-directed IRA. I have bought some cheapo houses, rehabbed, and sold with proceeds going back to IRA. I have also used to make hard money loans to local investors that I know.
The rules that you can't transact / loan money to yourself (or immediate family such as spouse, parent, child) are not a burden to me. I am purchasing and selling with others. I have considered doing some deals with adult siblings, who are excluded in "immediate family" rule.
Do any of you know of any specific books or chapters that talk about the experiences of handling your IRA dollars this way? I get lost in the details if I just read about it and I do not feel confident enough to just jump in. Has anybody written about what they did, how they did it, and how/when they made changes and why? If not, maybe you guys can get together and write about it? Do you think there is a minimum in an IRA that would make this worth it to try? Thanks!
I started with about 5k a month or so ago and I invested in tax deeds in Fl ( 18%) focusing on interest and not the actual properties. I also use Equity trust as they had no per transaction fees like some others.
Really check out the fees structure as some SIDRAs charge like $75 per transaction which makes it expensive if you have small funds in the SIDRA. I plan on moving my other IRAs to SIDRAs once I am allowed to.
[ Edited by linlin on Date 11/06/2004 ]
Quote:
On 2004-11-05 18:12, ceinvests wrote:
Do any of you know of any specific books or chapters that talk about the experiences of handling your IRA dollars this way? I get lost in the details if I just read about it and I do not feel confident enough to just jump in. Has anybody written about what they did, how they did it, and how/when they made changes and why? If not, maybe you guys can get together and write about it? Do you think there is a minimum in an IRA that would make this worth it to try? Thanks!
Equity Trust, ( www.trustetc.com) used to have a cassette tape they would send out, with lots of ideas, etc. I don't know if they still have those or not. They do have an education section, as well as multiple FAQ sections which are informative.
As for a minimum IRA amount...well, you have to have at least enough to do a deal. Don't bother transferring your IRA to a self-directed if you don't think you can do a deal with that amount. You know best what your deals are like.
For smaller dollar amounts, you can loan out as hard money, put options on properties, do short term lease purchase, take properties 'subject to", etc.
When you get it built up a little more, you can buy cheap houses.
There are hundreds of variations on what you can do with self directed IRA's.
We attend many REIA and other REI events. Entust and Equity Trust also attend frequently. It may be worth a call to both of them (and the others) to check their schedules and talk to them at such an event. I seem to get a lot more out of a face-to-face than a phone call or web/email inquiry. Just my thoughts...
Best regards,
Tim
Look for a book called "IRA Wealth" by Rice. It is definative on the what you can do in a SD one.
14% is not bad but not enough to tempt me unless I had millions and didn't wish to work at all. I pay 12% to my private investors often with a bonus at the end and still make a return in the 100-1000% range on my money. I get several times that through the stock market but don't enjoy it anymore and am moving away from it.
What is the return on OPM? INFINITE!
It really is about finding your level of comfort and working there. I have a mortgage broker on my team and really all they do is match needs, people that need $$ with those that have it. You could do the same if that is your dream and again you have an infinite return because your money is not invested
I was thinking that Sterling was more economical than equity, but am not sure since one of the previous posts. $185 doesn't seem like too much. I am going to move some into one and have been reading the book mentioned above
Best of luck!
[addsig]
Excellent Posts/Info/Details:
Thank you all! Good Winter Project to Educate Myself!
Sorry for the ignorance, but how do you go about investing in tax deeds? I
Quote:
On 2004-11-06 00:40, linlin wrote:
I started with about 5k a month or so ago and I invested in tax deeds in Fl ( 18%) focusing on interest and not the actual properties. I also use Equity trust as they had no per transaction fees like some others.
Really check out the fees structure as some SIDRAs charge like $75 per transaction which makes it expensive if you have small funds in the SIDRA. I plan on moving my other IRAs to SIDRAs once I am allowed to.
<font size=-1>[ Edited by linlin on Date 11/06/2004 ]</font>
Sorry for the ignorance, but how do you go about investing in tax deeds? I
Quote:
On 2004-11-06 00:40, linlin wrote:
I started with about 5k a month or so ago and I invested in tax deeds in Fl ( 18%) focusing on interest and not the actual properties. I also use Equity trust as they had no per transaction fees like some others.
Really check out the fees structure as some SIDRAs charge like $75 per transaction which makes it expensive if you have small funds in the SIDRA. I plan on moving my other IRAs to SIDRAs once I am allowed to.
<font size=-1>[ Edited by linlin on Date 11/06/2004 ]</font>
I meant to say tax liens. But I do it 2 ways - 1) I went to the county certificate sales and got some there
2) I contacted the counties, bought their lists of available tax certificates, did a ton of due diligence and then I have been buying the certificates monthly on the properties I think are worth it.