Most of the questions surround buying investment properties in Hattiesburg MS… which we of course know a lot about. Contact us today so we can begin working with you to reach your goals. This includes buying or selling a house in [market-city].
But one part of buying an investment property / rental property is how are you going to pay for it?
And, can I use my IRA to buy local investment properties?
Self Directed IRAs for Real Estate – Can You Use Them To Buy Hattiesburg Rental Properties?
An IRA, or individual retirement account, is a common tool used for retirement savings. Traditionally, IRAs hold investments like stocks and mutual funds, which are the typical avenues for most individuals looking to save for retirement. However, real estate can also serve as a powerful option for wealth building.
If you’re exploring how to leverage your IRA for real estate investments in Hattiesburg, you can effectively grow your retirement fund while benefiting from the tax advantages that an IRA provides. It’s important to note that self-directed IRAs for real estate have gained popularity among investors. However, when utilizing your IRA for local real estate investments in MS, it is crucial to adhere strictly to the legal requirements to ensure compliance with the law.
Some Simple SDIRA (Self Directed IRA) for Real Estate Rules To Follow
No “Self Dealing”
If you’re using your self-directed ira for real estate in Hattiesburg you are forbidden from self-dealing.
Self-dealing is outlawed with your SD IRA in the sense that it can’t purchase land or property (both commercial and residential) for the owner or any family member to reside in.
It is also prohibited from selling property or land to the owner of the IRA or family members in the process of business dealings in Hattiesburg.
The Process of Buying Hattiesburg with Your Self Directed IRA
When utilizing your Self-Directed IRA (SD IRA) to invest in properties located in Hattiesburg, MS, it is essential to adhere to a set of specific regulations designed to ensure compliance and protect your investment.
Initially, you must provide the self-directed IRA custodian with the appropriate documentation required for acquiring the local investment property in Hattiesburg. Once this documentation is submitted and verified, the custodian will initiate the purchasing process on behalf of your self-directed IRA, managing all transactions related to the real estate investment.
It is crucial to ensure that your IRA has sufficient cash reserves to cover all costs associated with the property purchase. These expenses may include, but are not limited to, closing costs, taxes, and maintenance fees, all of which must be processed through the self-directed IRA account.
Neglecting to maintain adequate funds may result in severe consequences, including the potential forfeiture of tax benefits linked to your IRA, as well as the imposition of hefty penalties. Therefore, careful financial planning and attention to detail are paramount when navigating the landscape of real estate investment through your SD IRA.
Choose The Type Of Self Directed IRA Wisely To Use It For Your Real Estate Investments
There are lots of options when it comes to self-directed IRA’s.
Not all SD IRA’s allow you to buy real estate in them… so you’ll have to do your research to find the best SD IRA custodians so you can start buying Hattiesburg properties in it.
NOTE: We’ve worked with many SD IRA companies and we’ve found the best providers who are very experienced in working with real estate within an IRA. Call us today at (601) 336-1835 or email us through our Contact page and we can give you information on the best SD IRA companies for Hattiesburg MS real estate investments.
Checkbook Control
Some Self-Directed IRAs come with varying degrees of restrictions that can significantly impact how you manage your investments. For instance, certain accounts mandate that you submit detailed information about your investment opportunities for their review. They will evaluate the proposal and, upon approval, release the funds from your account to facilitate the investment. This process can often be time-consuming and may hinder your ability to act quickly on potential deals.
In contrast, there are accounts that offer what is known as “checkbook control.” This feature empowers investors with full control over their funds, particularly in the realm of real estate investments. With checkbook control, you can make purchases simply by writing a check, bypassing the lengthy approval process that often involves a custodian. This flexibility allows you to seize investment opportunities swiftly—especially crucial in Hattiesburg, where desirable properties can sell rapidly. Having this level of control not only streamlines the investment process but also gives you a significant advantage in a competitive real estate landscape.
Your Role In The Investment After The SD IRA Purchases It
You as the owner of the self directed IRA account has the ability to really manage the investment in a hands on manner. The roles include: receiving checks for rent payments from tenants, managing the properties, etc… everything you’d normally do as the owner of an investment property.
Of course, there are more guidelines that you have to follow if you plan on using your self directed IRA for real estate in Hattiesburg… so make sure you do your homework and do these two things immediately:
- Find a great self directed IRA company / custodian: This is the first step. You have to get this in place before you even think about purchasing anything through your IRA. If your current IRA holder won’t allow you to buy and hold real estate in it… call us at (601) 336-1835 and we’ll refer you to the best local custodians… and they’ll be able to help you transfer your current IRA to your new self directed IRA.
- Find a couple great Hattiesburg investment property experts, like us at MS Home Buyers. One of the best ways to get great properties here in Hattiesburg MS is by working with a professional investment property company like ours. We find high discount properties (both single family and multi-family) all around Hattiesburg and sell them to investors like you at discounts so you can turn them into solid profitable rental properties. You can send us an email or call us at (601) 336-1835 to begin the relationship with us. We would like to hear more about your needs or goals.
We Can Help You Get Rolling With Your SD IRA For Real Estate.
Just reach out to us at the phone number below or send us an email… and we’ll walk you through the process, point you to the best SD IRA resources locally in Hattiesburg, and get you on our Preferred Investment Property buyers list.