Important Aspects to Know About SMSF Property Loan

A growing number of Australians are showing interest on taking out Self-managed super fund (SMSF) loan in terms of planning their retirement. These days, Australian government has implemented many strategies to encourage people to plan for their retirement by managing super savings. Due to limited recourse borrowing arrangements (LRBA) you can simply borrow funds from lenders to make investments like commercial or residential property. Let’s understand the important aspects about SMSF property loan. 

What is SMSF Loan? 

A SMSF loan is an exceptional mortgage option to purchase investment property outright. When it comes to purchase commercial or residential property there is no better option than tapping into SMSF mortgage for your financial security.  

As a SMSF member, you can nominate properties to be included in an SMSF and make investments. All running costs are covered by the fund. However, the purchased property can only be used for investment purposes which means borrower and his closed family members can’t reside in the property.  

Borrowing Criteria of SMSF Property Loan 

In order to get approved for SMSF loan, you need to provide certain documents or proofs to lender: 

  • Proof of personal income. 
  • Proof of SMSF bank statements. 
  • Rental estimates evidence. 
  • Documents of audit certifications and rental estimates. 
  • Copies of SMSF trust deed, custodian trust deed and the contract of sale. 

Providing such documents or proofs are important to secure the loan. If you find difficulty understanding the lender’s requirements, consult the best home loan broker. He will help you in collecting documents that is important for loan approval. 

Advantages of SMSF Property Loan 

Huge Investment Flexibility – With SMSF loan members have flexibility to alter the rules to suit their specific needs and circumstances which is not available with super funds.  

Better Tax Management – Securing an SMSF loan allow you better control on your assets and investment decisions. In addition, through SMSF you may be able to reduce or eliminate capital gains tax liability. 

Asset Protection – In general, creditors cannot control superannuation assets. This protection applies to assets in which the superannuation funds have a beneficial interest.  

Your Finance Adviser – The leading Finance Advising Company Australia 

We are Australia’s accountable finance advising company that helps individuals and businesses to simplify their financing needs. We have an experienced and skilled team that works towards finding loan options to suit everyone needs. With our extensive range of online home loan calculators in Australia, you can easily manage expenses.   

To ask your queries, speak to Mr Rohit Khatak, Home Loan Broker Balmain. 


 

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