Self-Managed Super Fund (SMSF) Home Loan
A key reason people elect to manage their own superannuation is the flexibility to choose where their money is invested
Self-Managed Super Fund (SMSF) Home Loan
A key reason people elect to manage their own superannuation is the flexibility to choose where their money is invested. Changes to superannuation legislation now allow self-managed superannuation funds (SMSFs) to borrow, and to invest, providing certain conditions are met.
This means that if you have a self managed super fund (SMSF), you may now borrow money to purchase a Residential or Commercial Property through your fund. For further information, contact Best Home Loans, your self managed super fund lending specialist team.
Acceptable Items for Borrowing
- Rental Income
– 80% of proposed rental income from the property to be purchased - Other SMSF Income
– for a residential loan, 80% of all income assessed from the previous 2 years’ tax returns or financial reports and;
– for a commercial loan, 70% of all income assessed from the previous 2 years’ tax returns or financial reports - Member Contributions
– for a residential loan, 80% of member contributions assessed on either:
– the previous 2 years’ tax returns or financial reports (existing Fund)
– superannuation contributions shown on previous 2 years’ tax returns of the beneficiaries (new Fund)
– ability to make additional contributions to a new or existing fund
– for a commercial loan, 70% of member contributions assessed on either:
– the previous 2 years’ tax returns or financial reports (existing Fund)
– superannuation contributions shown on previous 2 years’ tax returns of the beneficiaries (new Fund)
– ability to make additional contributions to a new or existing fund
Super Fund Loan Exclusions
- owner-occupied purpose
- construction loans
- non-prime lending areas
- some security types – second mortgage, vacant land, company or stratum title, properties exceeding 2.5 hectares
- non-residents, refinances, redraws, increases
At a Glance
- the purpose of the loan is to only purchase a residential investment or commercial property
- no additional security properties can be supplied to reduce the loan to valuation ratio (LVR)
- for a residential loan, the maximum LVR is 80%, depending upon the lender, based on a standard residential property in a metropolitan area
- for a commercial loan, the maximum LVR is 70%, depending upon the lender
- the purchase of the property must be from an unrelated party
- loans are available from $10 000 – $500 000, depending upon the lender
- loan term is between 4 – 30 years for a residential loan and 4 -15 years for a commercial loan
- interest offset is available, depending upon the lender
- non-recourse loan
- both variable and fixed rates are available