Hitting the 401K

Now you can make Safe, Secure investments and still earn HIGH, guaranteed returns for your 401K account

There has never been a better time to be invested in residential real estate…..NEVER

As Warren Buffet likes to say, buy while the blood runs in the streets. That’s what we do with residential real estate and now is the time for you to get top dollar guaranteed returns for your 401K. But you don’t own the property, you own the mortgage. And if you are not as stupid as the commercial banks that got caught with their pants down last year, you can have a very secure investment.

I buy and sell single family homes in the Atlanta area and I have gotten pretty good at buying houses at DEEP DISCOUNTS. This is especially true in today’s market when banks are eager to sell houses at 40-50% of present market value.

Sometimes I come across a deal where I just don’t have time to wait around for the long drawn out process of dealing with a bank in order to fund the buy. So what I do is find someone who has some money to invest who isn’t really happy with 1.5% on a CD or Money Market and instead wants a GREAT return on a SAFE and SECURE investment.

I use their IRA money to purchase the home and fund any repairs required and in return, they get a first mortgage, a Security Deed on the home, title insurance and a GREAT interest rate guaranteed,on their funds. In most cases the mortgage will be only 50% of the value of the home.

If your investment of $50,000 is secured by a home worth $100,000 and the housing market takes a dive of 20%, your security is still worth $80,000. The investor who owns that home (me) will have lost 40% of his equity, but the lender (you) hasn’t lost a dime and in fact will still earn the guaranteed GREAT interest stipulated in the Mortgage.

When I sell the house, your Pension Plan is paid back all the money borrowed along with the guaranteed interest. We never touch your money since your plan Trustee wires the funds to the Closing Attorney, who in turn wires the repayment and interest cash directly to your plan Trustee.

Funds in your Pension Plan, IRA or 401K can earn guaranteed HIGH interest, income tax deferred, but to make it even better, we suggest you convert your conventional plan into a ROTH 401K or IRA and your earnings are TAX FREE. We can show you HOW. It’s fast, easy and SAFE.

Now, I won’t pretend to ignore the elephant in the room…….the crisis caused by the recent Mortgage Upheaval. Remember what I said about the loan tovalue ratio being about 2:1 or 50% LTV on my program. That is what makes this such a SECURE plan. In years past, bank stock was considered the “gold standard” in investments. Banks used to require 20-30% down payment and proof of employment and proof of your ability to pay back the loan. Home mortgage defaults were few and far between. Once those standards were relaxed, all bets were off. Many folks bought homes in the last 5 years with no money down, no proof of income, no proof of credit history and no employment record. (To make matters worse, because prices were increasing at such a rate, many banks offered to loan 10 – 20% MORE than the home was worth.) It was cheaper to buy than it was to rent. If the home owner had nothing invested in the home, ie, “no skin in the game”, when times got a little tough, there was no incentive to stick it out. Many, many folks just walked away from their homes and allowed them to go into foreclosure. Sure, they took a credit hit for a few years, but many walked away improving their net worth by tens of thousands of dollars. Money they didn’t have to repay to the bank on a home that was suddenly worth much less than they had paid. Once that started, prices began to fall rather than continue the perpetual appreciation of the last hundred years. Thus was born the “sub-prime meltdown”. When your loan is guaranteed by a home worth two times as much as the loan, your SECURITY is GUARANTEED. This makes the loan MUCH safer than equities or bonds.

How much cash is required?? We have done Private Lender mortgages for as low as $5000 up to $200,000. Larger loans generally earn higher interest rates. Loans are usually fixed rate for 3-5 years but other terms are possible. You are the bank….we will work to make you happy.

How Does it work??
If you are interested, let us know by completing the information card on the website. Tell us how much you would like to invest and when your funds will be aailable. We see deals almost every day and as soon as one comes along that meets your parameters, we give you the particulars on the house. We will give you the costs estimates, the comparable sales figures, pictures and details on the neighborhood. If you like the looks of the deal we put a contract on the house and close as soon as your funds are available. Because we can generally close quickly, we are able to get better deals than most.

Can I get out early?If you think you might need the money for something else before the end of the note, you shouldn’t enter into the deal. That said, there is NO penalty if you DO want out early. We just locate someone else to take over your position, and substitute their documents for yours and transfer their funds to you. You earn interest based on the length of time your funds are invested. It could take 4-6 weeks to do the substitution, but you DO NOT pay a penalty nor do you have to wait for us to sell the house.

How do I get my interest? Most Pension Plan money earns guaranteed interest which is accrued until the end of the note and paid with the principal. However, we can make monthly or quarterly interest payments if you prefer. Payments are of course interest only as there is no amortization of the mortgage. Interest payments are paid directly to the Plan Trustee.

What about my Life Insurance cash value??Some investors borrow their cash value from their whole life insurance policy, which usually earns at about the rate of a CD and loan that cash into our program to earn at top dollar. The spread can be pretty substantial.

I am sure there are many questions still unanswered. Call at your convenience and we can discuss any additional details.

About the Author

Full time Real Estate Investor and Professional Home Buyer, we specialize in buying houses in Lilburn GA, Snellville, Lawrenceville and Loganville, GA. We frequently use Pension Plan money of other investors to fund our purchases.,