QUESTION: I am preparing to purchase some property for $40,000. I have $33,000 in my solo 401k Trust, I will be adding an additional $7,000 of my personal money for the purchase.
Is it possible for the solo 401k trust to borrow the money or to take title as joint tenants, me personally being the joint tenant. The property is 20 acres.
ANSWER:
If the solo 401k obtains a non-recourse loan, the loan must be paid back
with solo 401k funds. Please click here
to learn more about the non-recourse loan arrangement. The lenders can be either
a bank, a hard money lender, or a third-party, but not a disqualified party
such as the solo 401k owner, his or her spouse, children, parents, etc. Visit disqualified solo 401k parties for a
full list.
The
following banks specialize in non-recourse lending to retirement accounts:
Alternatively,
if you go the tenants in common route, visit solo 401k tenants in common scenarios
to learn more.
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