The Define Benefit Plan Dilemma
For those of you who know what a Define Benefit Plan is I need your help.
I have a client who wants to take $500,000 from his Define Benefit plan and buy 2 properties. He will spend $500,000 for each property and put 50% down in cash on each. A Define Benefit Plan will allow encumbered real estate in the plan as long as the purchase note and trust deed is a non-recourse note. The problem I am having is I can not find a lender who will loan on a Define Benefit Plan. I have found several who will loan on an IRA but not a Define Benefit Plan (DBP).
Here is the criteria:
- No paperwork (none! Nada! Any!) can be in my clients name
- The vesting and purchase agreement will be: "The Trust Company, Custodian for, John & Mary Doe Define Benefit Plan, Account #4567890"
- All paperwork will be signed by the Custodian
- No money from the client can be deposited into escrow (not even the deposit)
- The deposit must come from the DBP
- All loan documents must be signed by the Custodian
- All future bills and payments will be made by the Custodian
- After the purchase there must be 20% of the purchase price left in the DBP
As you can see this is a very good loan but I can not find anyone who will make the loan. I am seeking your help for a lender who is making this type of loan.
Sherman Smith & Associates