While many financial services firms will not allow you to invest in real estate with your IRA due to increased paperwork requirements, the IRS does not forbid such investments. If the borrower defaults, the issuer can seize the collateral but cannot seek out the borrower for any further compensation, even if the collateral does not cover the full value of the defaulted amount. Purchase the Investment. Our clients invest in an extraordinary variety of different types of real estate: single family, commercial property, land, notes, mortgages, real estate investment trusts REITs , and more.