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Private Lending

Turn your Self-Directed IRA (SDIRA) into a lending institution with private lending investments. This type of investment strategy gives you the freedom and flexibility to lend money from your IRA to individuals and corporations (via promissory notes), with the ability to earn interest on private loans.

  • Choose your terms

    Control your repayment terms, interest rates, and more.
  • Earn tax benefits

    Earn tax-free or tax-deferred income in your self-directed IRA.
  • Make an impact

    Help support your community initiatives with investment lending.

What is Private Lending?

Think of private lending like a bank: Your IRA acts as the lending institution, with businesses and consumers acting as the account holders.

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People in need of a loan or financing would borrow money from your SDIRA. That means you could lend to a neighbor who wants to open an animal rescue or to a business that’s looking to expand.

As a lender, you have the power to make final decisions on the terms, rates, and whether or not it’s secured. With private investor loans, you’ll make money by the interest paid on the loan.

Navigation Tip:

Beware of prohibited transaction rules that disallow lending to certain family members or any persons deemed a Fiduciary to your IRA.

Types of Private Lending

Promissory notes

Mortgage notes

Trust deeds

Hard money loans

How To Fund Private Lending Through a Self-Directed IRA

Find a borrower

Choose a qualified borrower for the loan (not a family member of any type or a fiduciary.)

Set your terms

Set the terms of the loan, including if it’s secured or unsecured, down payment, and interest rate.

Entrust Mainstar

Mainstar Trust will execute the loan on behalf of your SDIRA.

Earn interest

All borrower payments, including interest, go directly into your Mainstar Trust account.

How To Invest With Private Lending

Investors are encouraged to do adequate research or contact a broker/financial advisor, attorney or CPA to determine if private lending is an appropriate investment.

Once you have determined that private lending is suitable for you, a specific note can be purchased with your Self-Directed IRA or another retirement account at Mainstar Trust. Click below to discover how to use a Mainstar Trust account to invest in a private lending product.

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