12 Jul

WHO IS LEFT TO LEND TO SMSFS?

Posted at 10:44h

Borrowing to buy a property in your Self-Managed Super Fund is a relatively new and exciting wealth creation strategy.  Though it is not suited for everyone, those that are suited to it should seriously consider the option.

When the law first changed to allow SMSFs to borrow, only a few specialist lenders went into the market. The four major banks took several years to follow suit, and only three of them had a publicly offered product with the fourth doing loans only for “special clients”.

Recently the major banks have completely pulled out of lending to SMSFs to buy property, leaving only a few of the smaller banks or non-bank lenders to do so. Some specialists focus primarily on lending to SMSFs.

Another option to borrowing directly from a financial institution is that you yourself can lend the money to your SMSF. In many instances, this is the best course of action. Even if you do not have the funds easily at hand, you can borrow against your own home and lend the money to your SMSF.

If you already have an SMSF loan or are thinking about obtaining one, contact a reputable broker with experience in SMSF loans to ensure the best product is selected for your needs.