Using 403 B and Roth IRA Money

Is it possible to move money from a Roth IRA and a 403B account into an investment property without early withdraw or tax penalties? I have around 15K in several different funds that I believe would serve us much better if they were used to help us purchase more properties. I have a small rental that I could pay off with this money. I’ve had two bankers tell me that I could use a fee and clear property for leverage for additional loans. Banks financing our deals at this point seems to be the most cost effective route to go. Maybe we’ll find a private lender or hard money lender at some point but right now, we don’t have any kind of relationship with any other lender.

Does anyone have any experience using these kinds of accounts for REI?

It was suggested to me to contact a company called Equity Trust and they will be calling me. Thanks!

There are many Trusts which can be used including Equity Trust (formerly Mid Ohio Securities) to roll over your IRA or other qualified money into a Self Directed IRA Plan. Make sure the trust you use allows you to buy and sell real estate, mortgages, notes, etc. before you select them for your rollover account.

Also, check with your 403b Plan to be sure you can roll those funds into an IRA Rollover account…often times, the plan allows for rollovers only when employment has been terminated. Read the trust agreement so you can make an informed decision.

Lastly, be certain to know what the new rollover trust’s requirements are for transactions…make sure you transactions are ‘arms length’ transaction and comply with the requirements of your new IRA Rollover.

Hope this helps.

Rob in Atlanta

Thanks Rob! I will be checking into this more!

paying off an existing rental with IRA money is a prohibited transaction.

The only way an IRA can invest in real estate is when the IRA owner receives no beneficial interest from the IRA funds. If you personally benefit, then it’s classified as a withdrawal and subject to tax + penalties.