Super Loans - SMSF Loans

The Superannuation Industry Supervision Act (SIS) was amended in September 2007 to allow Self Managed Superannuation Funds (SMSF) to borrow to acquire an asset under specific conditions. This creates potential opportunities for customers to borrow under this structure to finance the purchase of assets through their super fund.

Customers must seek financial advice, as to their eligibility for the proposal under the SIS Act. Whilst Moshav Financial has lending solutions available, we are able to provide advice on a variety of financing solution.

What opportunities exist for SMSFs under the new rules?

The primary opportunities for SMSFs from the new rules are as follows:

  1. Small business owners can use these arrangements to help them buy their business premises through their SMSF (Company trustees only).
  2. Company trustees of a SMSF can buy a residential investment property through their SMSF.
  3. Primary producers are now able to use these arrangements to help them buy property used in a primary production business through their SMSF (Company trustees only).

How does the structure work?

Self Managed Super Funds can borrow to purchase an investment property via a 3rd party - a Property Trustee - who holds the property in trust until the loan is repaid. Under this structure, the SMSF becomes the beneficial owner of the asset.

The lender’s recourse against the SMSF and property trustee must be limited to the underlying asset ie. the purchased property.

The SMSF Trustee is entitled to rental income from the property (if any), after meeting any expenses in relation to the property incurred by the Property Trustee plus interest costs associated with the Loan.

The right finance option for you will depend on your financial position and goals. Click NOW to enquire online or 1300 766 612