I am looking to move some of my retirement funds to a self-directed IRA in order to make some real estate investments.

Does anyone on the forum have a trustee they recommend?

I assume you are talking about places like Vanguard, Fidelity, Schwab and the like. I use Vanguard myself but all three have a good track record I believe.

quote:

Originally posted by old rugged cross:
I assume you are talking about places like Vanguard, Fidelity, Schwab and the like. I use Vanguard myself but all three have a good track record I believe.

I don't believe any of those administer self-directed IRAs which allow investments in real estate, hedge funds and other alternative assets. It is usually a specialized trust company that handles these types of accounts.

I prefer Vanguard of those above,
but you can "do it yourself" with an IRA trading account (such as TD Ameritrade, Schwab, etc) and investing in REITs, building material suppliers, building equipment manufactures . . .. etc.

Jallen, will probably provide some good insight shortly.

Vanguard REIT?

We had a large number of these as customers in our loan servicing business. The IRA invested in secured real estate loans, often syndicated portions with my company doing the servicing.

A few bank trust departments were the trustees. I don’t think any of those banks exist now. Truth to tell, they were all inefficient, expensive and slow. It was a perpetual game of “Mother, May I?”

The bank was always able to staff with people who knew nothing of real estate and who had no authority to act without some bank committee. Several of the accounts were very large which made it somewhat worthwhile to fool with the incompetence of the bank, and their generous fees.

I would worry about ownership of real estate and title issues. There is an extra layer of nuance that many title insurers may not fully appreciate.

From what I have seen, the only people who make money in the scheme of investing self-directed IRA money into real estate are the companies that facilitate the sales and the property managers. The IRA owners, not so much. I only ever see them overpay for subpar investment property and then pay through the nose for ineffective property manangers or fund managers.

Make sure you understand the IRS prohibited transaction rules. A violation means the IRA stops being an IRA and all of the IRA assets are treated as being distributed to the IRA owner at FMV on the first day of the year.

I know of a situation where a gentleman used his IRA to own/develop real estate. He violated the prohibited transaction rules and the tax consequences were nasty. Neither the lawyer preparing the deeds, who wasn't a tax lawyer, nor the plan custodian, who allowed the self-directed transactions, raised any red flags.

quote:

The bank was always able to staff with people who knew nothing of real estate and who had no authority to act without some bank committee. Several of the accounts were very large which made it somewhat worthwhile to fool with the incompetence of the bank, and their generous fees.

How true. The attorney from Wyoming, Gerry Spence refers to them as Banksters.

Thanks for the input guys. I am a sophisticated investor who does this for a living outside my IRA. I was just wondering if anyone had experience with guys like Provident or Millenium or others.