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A promissory note is a loan, with a signed “promise” to repay the loan amount by a certain date, typically with interest added. Think of it like a loan from a bank – except now, you’re the bank.
Interested in real estate investing, but don’t want to be a landlord? Know of a local business in need of a boost? Promissory note investing – or private lending – gives you the opportunity to loan funds from your IRA or other account to real estate investors, business owners, or others, providing you with a stream of passive, predictable, tax-advantaged income.
It’s not uncommon for investors to receive a 10 percent or more interest rate on a promissory note investment
Invest in real estate without the added work of managing a property: there’s little to do other than watch your payments flow in
Hedge against the traditional market with an alternative investment that’s not tied to stock performance
Loaning from a qualified retirement account shields you from taxes on your interest
You are the bank, so you set the terms, including interest rate and repayment schedule, for predictable returns
Help a struggling business, fund a promising startup, or contribute to a neighborhood housing revitalization, for example
Wondering how fast you can grow your account with notes? An overwhelming majority of Equity Trust clients investing real estate notes receive 10-percent or more profits back into their retirement account.
Interest Rates | Percentage of All Notes Secured by Real Estate |
---|---|
Under 3% | 2% |
3% – 5% | 2% |
5% – 7% | 6% |
7% – 10% | 23% |
10% + | 67% |
Equity Trust enables you to loan money from your self-directed retirement account, tax-deferred or tax-free. Here’s what you need to know to recap the benefits of this powerful investment type in your retirement account:
Easily invest in promissory notes and countless other assets online with myEQUITY, our state-of-the-art online account management system. Our technology enables you to:
What are you investing for? Whether your “why” is retirement, healthcare expenses, or a loved one’s education, we make the journey easy with innovated technology and first-class service.
Let our industry-leading education and resources help you navigate through your note investing journey.
Learn how it works, promissory note investing rules, a real–life example, and how to get started.
Browse the tax-advantaged accounts and find one that matches your savings and goals- from retirement to education to health care savings.
Dig deeper into how note investing works in a retirement account.
Our knowledgeable IRA Counselors can answer your questions about the self-directed investing process and share insight and education about our self-directed accounts to help you decide what options may be best for you.
We respect your privacy and will not use the information you provide for any other purpose.