Private lending with your ira Archives

How to lend with your IRA or other retirement plans…private lending with your IRA.

Private real estate notes are a great way to keep your retirement growing nice and steady without the roller coaster ride of the stock market.

But did you know you can fund one of these loans with retirement funds through a company that offers Self Directed IRA Plans?

Most large IRA companies only allow you to invest in stocks and bonds. Self-Directed plans, however, allow you to invest retirement funds in any investment the IRS allows.

This includes real estate and loans.

To invest in private notes using your retirement funds, you must set up an account with a company that offers the Self-Directed options.

Here is a list of some of the companies that offer Self-Directed plans:

The Entrust Group
Equity Trust
Pensco
New Direction IRA
IRA Services Trust Company
Midland Trust
Mainstar Trust
Vantage IRA’s

Of course, you can check the web for other local options, too.

Once you establish an account with one of these companies or another you feel comfortable with, you can start funding loans!

Our suggestion is to select two or three companies you can see yourself working with and shop them for fees and customer service.

Some companies charge just an annual fee, and some charge every time you create or payoff a loan. Other companies might charge you both fees. So, it’s smart to take a few hours and see what best matches your needs.

If you’re interested funding short-term loans (3 to 6-month loans) and have a funds moving back and forth, you might want to stay away from companies that charge larger fees per transaction.

On the other hand, if you’re more interested in long-term loans that go on for years, you probably want to find a cost structure that has a lower annual fee and a larger per transaction fee.

It’s truly up to you and what you’re comfortable with.

So, go check out a couple. Find the fees that match your goals and the customer service reps who will answer the phones and your questions.

If you have any questions on private lending with your IRA you can reach out to us through the contact us form and we would be glad to help.

What are private real estate notes?

Private lending with your IRA

At this point, you know having a good loan means having good properties and good borrowers.

But there’s still one more key component that will help you build a solid foundation for your investments:

Good security.

We all interpret the same conversation in different ways. For example, a conversation between you and a borrower might be understood in two different ways: your way and their way.

That’s why it’s so important to know these top 3 ways to secure your loans:

Get it in writing and get it signed by both parties.
- No verbal agreements allowed.
- Record agreements like rates and terms.

Always have an attorney prepare your documents.
- Use YOUR attorney, not the borrower’s.
- Require the borrower to pay the cost of the attorney (not you).
- Ensure defaults are in place.
- Include all documents required by the state.

Close through a title company
- Make sure you’re in the proper lien position (first).
- Make sure the lien gets recorded.
- Make sure the closing is handled by a third party (title).

All of this might seem like a lot of work, but these simple steps will protect you, your loved ones, and your money.

Creating good returns with good loans can be easy and profitable. All you need to do is use the 3 key building blocks I’ve shared with you to create a strong foundation.

Good Properties
Good Borrowers
Good Security
Ready to build your foundation for good loans? Contact us today and see how we can help you succeed in private lending.
- Email us a question at Mike@TheNoteShop.com
- Schedule a 30-minute consultation.
- Enroll in my personalized coaching services.
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How to lend with your IRA or other retirement plans…private lending with your IRA.