Securing Personal Loan Using Solo 401k Funds Vs Non-Recourse Loan to Solo 401k

QUESTIONS:

I have a solo 401k trust and want to know about leveraging my solo 401k funds for  equity lines of credit; and reverse mortgages.

Do yo also have recommendations for banks who are familiar with these type of transactions should he proceed with any of the above transactions through one of the options referenced above.

ANSWERS:

The solo 401k rules allow for non-recourse loans to a solo 401k for investing in real estate through the solo 401k. For the non-recourse loan rules, see the following.

https://www.mysolo401k.net/quick-yet-precise-explanation-solo-401k-non-recourse-loan-debt-financing-leverage-process/

For a list of banks that will loan to a solo 401k plan, see the following.
On another note, the 401(k) regulations do not allow the solo 401(k) owner to use any of his or her solo 401(k) assets for securing a loan to the solo 401k owner. Such a transaction is considered a prohibited transaction. For more information on the prohibited transaction rules, see the following.

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About Mark Nolan

Each day I speak with energetic entrepreneurs looking to take the plunge into a new venture and small business owners eager to take control of their retirement savings. I am passionate about helping others find their financial independence. Having worked for over 20 years with some of the top retirement account custodian and insurance companies I have a deep and extensive knowledge of the complexities of self-directed 401ks and IRAs as well as retirement plan regulations. Learn more about Mark Nolan and My Solo 401k Financial >>

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