SMSF lending
Let your super fund do the talking
Self-Managed Super Fund (SMSF) lending is a specialised form of financing that allows your SMSF to borrow money for the purpose of investing in property. This strategy, known as a ‘limited recourse borrowing arrangement’ (LRBA), can potentially enhance your fund’s investment portfolio by enabling it to acquire assets that may otherwise be out of reach due to capital limitations.
Maximise your investment with an SMSF loan
Key Features:
- Limited Recourse: The lender’s rights are limited to the asset held within the borrowing arrangement, protecting the other assets of the SMSF.
- Diversification: By borrowing to invest, your SMSF has the opportunity to diversify its investment strategy, which can include residential or commercial property.
- Potential for Capital Growth: If the property increases in value, the SMSF can benefit from the capital growth, all within the favourable superannuation tax environment.
- Rental Income: Property held within the SMSF can generate rental income, which can help service the loan and build the fund’s assets.
Considerations:
- Cash Flow: Your SMSF needs to demonstrate it has sufficient cash flow to service the loan, including interest payments and property maintenance expenses.
- Loan Structure: SMSF loans typically have different structures and terms compared to standard property loans, often with higher interest rates and lower Loan to Value Ratios (LVR).
- Compliance: Strict regulatory requirements govern SMSF property investments, and it is crucial that your fund remains compliant with the superannuation legislation.
- Exit Strategy: Having a clear plan for how the SMSF will manage the property and the loan in the long term is essential.
Role of a Broker
As a broker, we provide guidance and support tailored to first home buyers, helping to demystify the home-buying process. Our services include:
- Market Knowledge: We offer insights into the latest loan products from a range of lenders, ensuring you’re aware of all available options.
- Personalised Service: By understanding your specific needs and financial capacity, we can identify loan solutions that align with your goals.
- Application Process: We assist in preparing and lodging your loan application, ensuring all necessary documentation is in order and compliance with lender requirements is met.
- Communication: We act as the point of contact between you and lenders, managing negotiations and correspondence to streamline the approval process.
- Ongoing Support: From pre-approval to settlement, we provide continuous assistance, answering questions and offering guidance throughout your finance journey.
If you’re ready to take the next step, please reach out to our team today.
