Carried a performing note inside a Roth SDIRA for four years and pulled more than I expected
The note paid off last month, $47,200 landed back in the account, and the whole thing came out tax-free because it was a Roth. No UDFI because I never touched leverage, no custodian drama past the annual FMV update, and the borrower was a guy I'd done pipe work for who needed a bridge on a small commercial building outside Cuero. Fourteen percent, 36-month term, he paid it off early. I put the note in there originally because I had no idea what else to do with $40k sitting in a Roth I'd barely touched, and somebody at a job site told me notes were cleaner than property inside these accounts. He was right. No tenants, no maintenance calls, no trying to get a custodian to approve a $600 plumbing repair in time. I've got two more lots in Guadalupe County I'm trying to decide what to do with and I keep thinking about doing it the same way, find somebody who needs short money, put a note on the land, let the Roth collect the interest. The part I didn't fully appreciate going in was how much simpler the exit is. Note matures, wire comes in, done. There's no appraisal fight, no selling costs, no waiting on a buyer.
