Investor Insights Blog|How to Invest in Private Debt or Promissory Notes with an Equity Trust Account

Promissory Note Investing

How to Invest in Private Debt or Promissory Notes with an Equity Trust Account

A self-directed account with Equity Trust Company allows clients the freedom to invest in alternative asset options – such as private money lending (private debt) or promissory notes – with a tax-advantaged IRA or other account.

Loaning money from your retirement account? Our account management system myEQUITY provides a simple, straightforward solution to quickly initiate an investment.

Using the Private Debt Wizard, you are able to submit your investment request online.

3 Steps to Private Money Lending in Your Self-Directed Account

If you have not yet opened an Equity Trust account, contact us at 855-673-4721, or open an account online.

15-Minute Guide to Notes Investing with a Self-Directed IRA

Once your account is open and funded, these three easy steps will allow you to complete your private debt investment with any internet-connected device:

1. Initiate your private debt investment

Visit www.myEQUITY.com and navigate to Investment > Private Debt to begin the step-by-step Private Debt Wizard.

Sign the completed Direction of Investment form to submit your request (an eSignature option is available).

Additional documents may be needed – read our Frequently Asked Questions for more details.

2. Equity Trust processes the investment

A Private Debt Liaison will be assigned and will review the details of your investment direction. Your liaison will contact you if there are any additional details required to fund your investment.

Video: Private Lending and Promissory Note Investing with a Self-Directed IRA

3. Investment is funded

After your investment request is processed, Equity Trust will disburse the funds to the payee/borrower based on the instructions you provided.

If you do not wish to submit your request online, you also have the option of printing a Private Debt Direction of Investment Form (found on myEQUITY) and submitting it to 440-366-3752 (fax) or [email protected].

Want to discover private lending in action? Read about Guy and his hands-off note investment.

How do I roll over funds to my self-directed IRA?

After you open your account with Equity Trust, you will contact your previous employer regarding the required paperwork to roll over an IRA. In most cases this will include account numbers and balances. If you do not have that information, an Equity Trust specialist can contact your previous employer or plan administrator while you are on the line. Then you will complete all paperwork received from the plan administrator and ask the plan administrator to transfer your retirement assets to your new Equity Trust IRA account number.

If the plan administrator for your previous employer’s plan requires Equity Trust to complete a portion of the distribution form, please mail it to Equity Trust Company along with the most current plan statement. Equity Trust will complete the required sections and mail the paperwork to the plan administrator.

What investments can I make using a self-directed IRA?

With a self-directed IRA, your investments are up to you, within the bounds of the IRS rules and guidelines. The IRS does not provide guidance on what investment types are permitted, but dictates only what is NOT permitted. Examples of prohibited IRA investments include collectible (such as artwork, stamps, rugs, antiques and gems), certain coins and life insurance. See IRS Publication 590 for more information about prohibited investments.

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