In this Distressed Real Estate and Note Investing podcast episode, author, attorney, and CEO of Directed IRA Mat Sorensen talks with host Brecht Palombo about how investors can use self-directed IRAs to buy mortgage notes and real estate properties.

Mat covers key points to consider when using an SDIRA for retirement investing, how IRA/LLCs work, and provides some great info on tax codes investors should know about.

Visit to learn more about how to take control of your retirement by investing in what you know. For in-depth SDIRA details, check out Mat’s best-selling book, The Self-Directed IRA Handbook, with tax rules, legal insights, and strategies for investing in real estate, notes, bitcoin, and other top assets.

Want to find out more about sourcing foreclosures, REOs, and non-performing note deals? Head over to for access to tools and resources, expert-led training, and the industry-leading BankProspector software….(read more)

LEARN MORE ABOUT: IRA Accounts

TRANSFER IRA TO GOLD: Gold IRA Account

TRANSFER IRA TO SILVER: Silver IRA Account

REVEALED: Best Gold Backed IRA

Self-directed IRAs have become increasingly popular among investors who are looking to diversify their retirement portfolios beyond traditional assets, such as stocks and mutual funds. One valuable strategy for utilizing self-directed IRAs is to invest in mortgage notes and real estate. Mat Sorensen, a renowned expert in self-directed retirement accounts, has successfully guided numerous investors on how to make the most of self-directed IRAs for these types of investments.

Mat Sorensen is a partner at Directed IRA & Directed Trust Company, one of the leading companies in the self-directed IRA industry. With his extensive knowledge and experience, he offers valuable insights on how to leverage self-directed IRAs to invest in mortgage notes and real estate.

One of the first steps in the process, according to Sorensen, is ensuring that you have a self-directed IRA custodian that allows for these types of investments. Unlike regular IRA custodians, self-directed custodians specialize in facilitating alternative investments such as real estate, mortgage notes, private loans, and more.

Once you have selected a self-directed IRA custodian, the next step is to identify the type of investment you want to pursue. In the case of mortgage notes, this involves purchasing the debt obligations created when someone borrows money to buy real estate. When the original lender wants to sell the mortgage note, you, as an IRA holder, can use your self-directed IRA to purchase it.

Investing in mortgage notes offers several advantages. First, it provides a steady stream of passive income in the form of monthly interest payments. This income can be reinvested or used to fund your retirement expenses. Additionally, purchasing mortgage notes allows you to diversify your investment portfolio while potentially achieving higher returns compared to traditional assets.

When it comes to real estate investments using self-directed IRAs, the opportunities are numerous. Sorensen advises investors to approach real estate investments with caution and conduct thorough due diligence. It is important to evaluate the potential risks and rewards before committing your IRA funds to a particular property.

Real estate investments through self-directed IRAs can take various forms, such as direct ownership of rental properties, real estate development projects, and even investing in real estate crowdfunding platforms. Sorensen stresses the importance of understanding the UBIT (Unrelated Business Income Tax) rules associated with certain real estate investments to avoid any unexpected tax consequences.

To make the most of your self-directed IRA investments, Sorensen suggests taking advantage of additional strategies. For example, partnering with other investors or pooling your self-directed IRA funds with other accounts can increase your purchasing power and allow you to invest in larger projects. Additionally, utilizing a self-directed Roth IRA can provide tax-free growth and tax-free withdrawals during retirement.

In summary, by utilizing a self-directed IRA, investors can tap into the potential of mortgage notes and real estate as alternative assets for their retirement portfolios. Working with an experienced expert like Mat Sorensen can provide the necessary guidance and knowledge to navigate the complexities of investing in mortgage notes and real estate using self-directed IRAs. With proper due diligence and an understanding of the potential risks and rewards, investors can diversify their portfolios and potentially achieve higher returns for their retirement years.