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SMSF Loan

SMSF (Self-Managed Super Fund) loans can help you invest in residential or commercial property if you don’t have the funds in your SMSF to buy an investment property outright. The property is held in trust for the SMSF in a proper formal structure until the loan has been repaid.

These structures are arranged through accountants and solicitors with appropriate advice provided to explain the suitability. Once they have explained the pros and cons of investing in this way, they may start the process which will enable you to apply for your SMSF loan.

SMSF loans are also known as Limited Recourse Borrowing Arrangements (LRBAs). This type of loan is a limited recourse loan which means recovery of the debt is limited to the security property and in the event of default, other super fund assets are not at risk.

Property Investor
Principal & Interest / Interest Only
Residential Security

6.65 % p.a. Interest rate 6.79 % p.a. Comparison rate

Property Investor (Principal & Interest and Interest Only)

SMSF Loan Interest Rate1 Comparison Rate2
Residential Security 6.65% p.a. 6.79% p.a.
Commercial Security 6.99% p.a. 7.19% p.a.
Features  
Minimum loan amount $100,000
Maximum loan amount $2,000,000
Maximum LVR Residential Security: 80%
Commercial Security: 70%
Maximum Loan Term Principal & Interest: Variable 30 years, Interest Only: Variable 5 years
Interest Type Variable Only
Repayment type Principal & Interest or Interest Only
Repayment Frequency Principal & Interest: weekly, fortnightly or monthly; Interest Only: monthly
Extra Repayments Unlimited
Interest Offset No
Redraw No
Pre-approval Yes
Split Loan Yes
Increase/top up No
Second Mortgage Security No
Online/Phone Banking Access Yes
Statement Frequency Quarterly

FAQs

  1. What is a SMSF loan?
    An SMSF loan is a home loan used by a Self-Managed Super Fund (SMSF) to buy investment property. The returns on the investment – whether that's rental income or capital gains – are funneled back into the super fund, increasing your retirement savings.


  2. How much can a SMSF borrow?
    SMSF loans generally allow up to 70% leverage and 30-year terms, with up to five years of interest-only repayments. The minimum loan amount is $100,000 with a maximum of $2,000,000, subject to lender approval of the property and borrowing capacity of the fund.


  3. Can I buy a property from my SMSF?
    Your SMSF can purchase a retirement home either outright (if it has the funds) or by borrowing from a lender. If the fund needs to borrow, the loan must be a limited recourse loan. This means that if the property investment fails, the other assets in the SMSF are protected from creditors.


  4. Can you live in your SMSF property?
    While you can't purchase a property to live in with your SMSF while you're still working, you can however purchase a home which you can live in when you are fully retired. This means that your SMSF can purchase an investment property, which you'd eventually like to live in and rent it out until you retire.


  5. How do I start a SMSF?
    To set up an SMSF you need to consider appointing professionals to help you.

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Any advice or information on this site does not take into account your personal objectives, financial situation or needs and you should consider whether it is appropriate for you. Please review G&C Mutual Bank's Terms and Conditions before acquiring the product.

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