Trust Deed Investing

Company Info

Using My IRA/ Pension/ Trust Fund to Invest In Trust Deeds and Mortgage Pools   

IRA, Trusts, & Pension Funds

How To Utilize Your IRA, Pension, Family Trust  or other Retirement Account  You can make an investment in a Private Investment Offering or Individual Trust Deeds  such as the ones GNT Financial has available from time to time, using IRA, 401K  or other retirement account funds. The investment stays inside your retirement account, so no early withdrawal penalty or tax penalty is created.  This is done through a Self Directed IRA or other Self Directed retirement account. They are easy and inexpensive to set up and use.

Self-Directed IRA / Account Custodians:

A self-directed IRA is legally no different from any other IRA. It indicates that you the client choose your IRA investments. The rules governing IRA investments types are exclusive - not inclusive. Therefore, you can invest your IRA funds in a virtually unlimited set of investments, except for those specifically excluded by law. The only assets excluded by the IRS are life insurance contracts, collectibles, and capital stock in an "S" Corporation.

Self Directed Account Custodians
There are a number of retirement account custodian companies that offer this service.  Please contact our office for a list of several firms that we have worked with over the years that can assist with this service.

Is this New?

No. Investors have been able to invest in trust deeds and mortgage pools within your Self Directed IRA ever since IRA's were created, over 30 years ago. Many financial professionals are unfamiliar or unwilling to offer the Self Directed IRA option to their clients, and continue to recommend stocks, bonds and mutual fund investments. Trust Deeds are not typically offered by investment advisors because they normally loose control of your account in the event you choose a Self Directed IRA. 

Retirement Account Types:

There are several different types of retirement accounts, including Traditional IRA, Roth IRA, SEP/IRA, KEOGH & DBPP Plans. Each has different rules regarding tax deductible contribution limits and reporting requirements. Types are listed below. Traditional IRA: Traditional IRA contributors can contribute and deduct up to a given amount each year. Deductible contribution amounts may be greater for those age 50 and over.

ROTH IRA:

Contributions to a Roth IRA are not tax deductible. However unlike traditional IRAs future distributions from a ROTH IRA are not taxable. Both Traditional and Roth IRAs grow tax free.


SEP/IRA Plan (Simplified Employee Pension plan) IRA:

Contributors can contribute as much as 25% of their net pre-tax income to their SEP and deduct it all, up to a large maximum annual contribution limit.

KEOGH:

Contributors (a Keogh plan and a Profit Sharing Plan are the same thing) can also contribute as much as 25% of their net pre-tax income to their Profit Sharing Plan and deduct it all, up to a large maximum annual contribution limit.

Note: SEPs have largely replaced Keogh Plans because of lower administrative costs and easier reporting requirements; however both are still in use.

Defined Benefit Pension Plan (DBPP):

Contributors can contribute a very large annual amount, recently as much as $165,000, into their retirement plan to reach their retirement income objectives. Please talk to your retirement plan custodian for more details and for current contribution limits.

Getting Started:

Transfer of an existing IRA, SEP/IRA, 401K, Employer Pension Plan, DBPP or Keogh in order to invest in Trust Deeds is simple and easy. It just requires selecting a new retirement account custodian that allows Self-Directed investments, then filling out a few transfer forms. Your new retirement account custodian will send the completed original transfer forms, once they get the signed originals from you, to your former retirement account custodians, who will then liquidate your holdings and send the money to your new retirement account custodian. Once the money is with your new custodian, you are free to invest it in a privately offered investment, such as the ones GNT has available from time to time.

IRA Investments in Trust Deeds

Once your funds are transferred, notify us of how much you'd like to invest in the fund or Trust Deed and hold the funds at your custodian in a short-term investment vehicle (Money Market) that can be easily liquidated. Once you are ready to invest in GNT Investments, we'll send you information and instructions. We will also give you instructions to give your IRA custodian on how to transfer funds to GNT Investments, or place the funds into escrow for the funding of an individual Trust Deed.  It is that simple..

Tax:

Interest income is usually tax deferred within in a retirement vehicle or, in the case of Roth IRAs, tax-free. Many smart investors understand this concept so they diversify by putting their high-yield, interest-bearing investments into their pension programs so they escape paying current taxes. Putting safe mortgage investments into a retirement plan and getting the benefits of tax deferral or tax exemption is getting the best of both worlds.

Security:

 A conservative interest-bearing investment in a Trust Deed or Mortgage Pool is an excellent way to balance any investment portfolio. These types of investment offer the security of Real Estate that is protected by equity in the property. This type of security coupled with superior yields, cannot be found in typical stock market investments.