Tustin, CA

So you have a self-directed IRA and you’ve invested in real estate, or you’re thinking about buying real estate with your IRA. You know your IRA needs to pay its share of the expenses. You’re plagued by one nagging question, “What do I do if my IRA runs out of money?”

It’s true that if your IRA owns 100 percent of a piece of property then the IRA pays 100 percent of the costs (closing costs, property taxes, repairs, etc). If the IRA owns 50 percent it pays 50 percent and so on. Now you’ve come to the point where you get a property tax bill in the mail for your IRA-owned rental house and there’s not enough in the account to pay for it. What’s next? What do you do? Fortunately the answer may not be as difficult as you thought.

The first thing you could do is to make an annual contribution. If you have a Traditional or a Roth IRA that contribution is limited to $5,000 or $6,000 if you are over 50. That could help. But what if you don’t have the $5k or really don’t want to use your cash for this purpose?

Fortunately there are still more solutions. Your self-directed IRA can own more than one asset. Say, for example, your IRA owns this rental house and owns some gold bullion. You could sell the gold and use the proceeds to pay for your property tax bill. No other assets in the IRA? No problem.

The next solution comes from the other IRA accounts you may have. Investment advisors always tell us to diversify so it’s likely you have a self-directed IRA and a typical IRA. You could transfer cash from your typical IRA over to the self-directed IRA and cover the shortfall.

Haven’t found your solution yet? Short on cash, no other assets, no other IRA? Well then what do you do? There’s still hope. Your IRA could bring on a partner. As long as the partner is not a “disallowed person” (ascendants & descendants basically) they can become a partner and bring in the needed cash.

It’s possible for your IRA to borrow money too, as long as it’s a non-recourse loan. In a case like this the non-recourse loan would more likely come from an individual than an institution. As long as the lender is not “disallowed” they can make this type of loan to your IRA but watch out for UDFI (unrelated debt financed income tax). Ask your CPA about that or go to www.irs.gov and look up Publication 598. If none of the solutions above work for you, you can always just sell the asset and be done with it. When you invest in real estate there are lots of expenses. It’s possible that from time to time your IRA may run short of available cash to cover them.

To re-cap here’s a list of the solutions:

• Make your annual contribution

• Liquidate other assets in the IRA

• Transfer money from other retirement accounts

• Bring on a partner

• Take on a non-recourse loan

• Sell the asset

To learn more go to www.uDirectIRA.com

When: 2/8/2010 7:00 PM to 8:00 PM Where: https://www1.gotomeeting.com/register/215027016 Description: Space is limited. Reserve your Webinar seat now at: https://www1.gotomeeting.com/register/215027016

Come learn how to self direct your own retirement into what ever investment you want with limited exceptions. Stop losing 40% in your retirement accounts and take control of your financial future. Join us as Mathew Owens a Certified Public Accountant and full time real estate investor combines with Kaaren Hall owner of uDirect IRA and expert about how to self directed your retirement account. We will be covering: - What is a self-directed IRA and how do you get started - What you can and cannot invest in - Types of retirement plans - How to build a massive cash flow inside your IRA - What you can invest in today to get started! - Cash flow deal presentation with a HUGE return on investment This is a free event and after the presentation you can start investing and securing your retirement.

Title: HOW TO RETIRE BUYING PASSIVE INVESTMENTS IN YOUR SELF-DIRECTED IRA!

Date: Monday, February 8, 2010 Time: 7:00 PM - 8:00 PM PST Register now for this event!

2010 is upon us. Are you ready?

The new year brings a few changes in the mortgage market.

The biggest change is the updated disclosure on the Good Faith Estimate.

It is a new multi page form that is designed to allow mortgage clients to easily see the costs and fees associated with the loan.

Certain bank fees and title escrow costs are not allowed to change by more than 10% +/-....

This is an effort to keep transparency of costs to the clients.

It also is supposed to keep shady mortgage brokers honest.

A more important rule to keep mortgage brokers honest is the new rule that they must be licensed, and register with the Nationwide Mortgage Licensing System Registry (NMLS+R).

This is a new agency that can monitor mortgage originators to be sure they are not performing any illegal activity, and to discipline them if needed.

FINALLY. This has been needed for the last 10 years and is part of the reason the industry has been so damaged.

Too many mortgage originators had too much freedom and greed.

I think this is all a step in the right direction.

In my 15 years of business, it is great to see some regulation in the mortgage industry.

Hopefully this, along with the tough market will continue to "weed" out the bad guys....

For 2009 the real estate market in California was up overall compared to 2008.

The market is very busy in the under 400,000 price range with many 1st time buyers and investors entering the market. The tax credit really helped too.

The over 400k range has been a bit slower but the drops in value in our area of Tustin Ranch, CA 92782 have not been to bad.

Most of the homes, townhomes, and condos appear to be selling quickly.

The prices are down, but not as bad as some other areas in Orange County.

Also the Government decided to extend the 1st time buyer credit until April, so move fast if you are buying.

They also added a "move up" credit for buyers wanting to upgrade to another home.

All good news.

2010 predictions I have seen:

-Continued improvement in the number of sales and possible gains in value.

-Rates to increase due to inflation pressures.

-Possible 2nd wave of foreclosures coming in the high end market to to Neg Am loan resets.

Who knows what the results will be.

All I know is there is a lot of activity out there.

Let me know what your thoughts are?

Also one of my resolutions for 2010 is to get my blog going.

Let me know what I can do to improve?

Thanks,

Chuck Davis

Mortgage pro in Tustin Ranch, all Orange County, and all Southern California.

Tustin Ranch Short Sale Another success !!!!!!!!

The seller bought the home in 2006 for $ 640,000 and never refinanced.

They had 2 loans

1st loan $512,000

2nd loan $128,000

both loans were serviced by the same lender.

We received an offer for $ 390,000

The short sale took a total of 5 weeks to get approved.

1st lender accepted $ 354,100 2nd lender accepted $ 2,000

The bank paid all past due taxes, HOA fees, escrow, title and commissions.

This seller received a full settlement for both loans.

Interested in short selling your home contact Ann Urias with ReMax Homes and Estates Pre-Foreclosure division.

www.orangecountyshortsalerealtor.com for more info.

List with an experienced Orange County Short Sale Realtor.

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Just Ask Kaaren When: 12/14/2009 4:00 PM to 5:00 PM Where: http://www.justaskkaaren.com/ Description: Just Ask Kaaren If you could ask any question about self-directed investing, what would it be? Join expert business coach, Larry Gassin as he interviews the president of uDirect IRA Services, Kaaren Hall. Ask your questions in advance and hear the answers during Larry's live interview Monday December 14th.. Date: Monday December 14th Time: 4:00pm PST To ask your question - http://www.justaskkaaren.com/