Private Lending

Satisfy demand for capital for those looking beyond banks by originating loans with your self-directed account.

Your account can lend money to individuals and businesses or purchase portions of existing loans through third-party platforms.

  • INDIVIDUAL HOME LOANS
  • BUSINESS STARTUP LOANS
  • BUSINESS CAPITAL INFUSION
  • PURCHASE OF EXISTING LOANS

You Choose the Terms

Although your account is technically the “lender,” as the account holder, you have the power to qualify buyers and make final decisions on loan terms and interest rates.

Secured or Unsecured

As the account holder, you can negotiate with the borrower to determine whether the loan will have security or not. Typically, security instruments will include a deed of trust, a vehicle title, etc.

Can A Self-Directed IRA Loan Money?

Self-directed IRAs can issue loans, turning the accounts into miniature banks. The amount you can lend to others is limited to the amount in the account, but otherwise, there aren’t any minimum balance requirements. You can start lending from your SDIRA if you have $1,000 in the account or $100,000.

Calculate your SDIRA Private Loan ROI around multiple investment options, use this free online

You control the lending process when you use your SDIRA to issue loans. You can choose the interest rate you charge, the term of the loan and the amount you’re willing to lend. You’re also in charge of choosing the people or companies you’ll loan money to, although there are some restrictions.

Origination Fee 3% to 5% of the loan

California Senate Bill AB 539 caps the “APR” Annual Percentage Rate at 36%. (plus the federal funds rate) Loans of at least $2,500-$10,000, but less than $3,000, may not exceed a maximum term of 48 months and 15 days. Loans of at least $3,000, but less than $10,000, may not exceed a maximum term of 60 months and 15 days.

SDIRA unlocks multiple investment options beyond the basic stocks, mutual funds and bonds.

Who Can Get a Loan From a Self-Directed IRA?

Your SDIRA can decide who to lend money to, with some exceptions. Under IRS rules, the self-directed IRA can’t lend to any disqualified persons. That means you can’t borrow from your self-directed IRA, nor can your relatives or anyone connected to the plan, such as the IRA provider or custodian.

Otherwise, you can choose who to lend to, whether it’s a stranger from the internet, a startup looking for funding or a close friend who needs money.

When your self-directed IRA makes loans, you establish the following:

  • Loan amount
  • Interest rate California 35.99% APR
  • Loan term
  • Payment terms and amount
  • Type of loan

Can A Self-Directed IRA Borrow Money?

You can also use your self-directed IRA to borrow money, mainly if you’re using the SDIRA to invest in real estate. You can apply for a non-recourse loan in the SDIRA’s name. The property the SDIRA purchases acts as the collateral on the loan.

An important thing to know about getting a non-recourse loan through your SDIRA is that the lender can only go after the SDIRA, not you if the loan defaults. The lender can seize your SDIRA but can’t try to seize any other property or assets owned by you.

Most Important Self-Directed IRA Loan Rules

Before you start lending from a self-directed IRA, there are a few important rules to know before you start:

  1. Due diligence: The first rule is to do due diligence before lending to anyone. Your SDIRA provider or custodian will not do this for you. It’s in your best interest to vet any potential borrowers and set the loan terms based on the information you uncover.
  2. Disqualified persons: The second rule concerns disqualified persons or who you can and can’t lend money. If the borrower is related to you or has a business connection to you, you can feel confident that the IRS considers them disqualified.
  3. Lending activity: All lending activity comes from the self-directed IRA. You and your SDIRA are entirely separate entities. Any money you lend comes from the IRA. If you contribute $1,000 to your SDIRA and then lend it to someone, you need to deposit the money first. It also means that any profits, such as interest earned, need to go back into the SDIRA. The borrower should make payments in the name of the self-directed IRA, not your name.


If you are borrowing with your self-directed IRA to purchase real estate, there are a few more rules to note. You can’t use your SDIRA to buy a home to live in. Similarly, you can’t buy a house for your brother or children using a non-recourse loan or any funds from your SDIRA.

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MKG Enterprises Corp is a diversified financial technology company with a mission driven purpose to strengthen our community by closing the wealth gap created by systemic disparities in the financial industry.

MKG Enterprises Corp is a diversified financial technology company with a mission driven purpose to strengthen our community by closing the wealth gap created by systemic disparities in the financial industry.

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