There are varying offerings in the market that are Instalment Warrants (or Property Warrants) and offerings that are SMSF Loans.  Instalment warrants are generally "bundled" products that involve managers or promoters who may charge additional fees and may place restrictions on the property assets being funded. A complying SMSF loan is a simple instrument to achieve your objective of leveraged property investment within your SMSF structure.

SMSF 'property trust' documentation can be used in conjunction with major lenders such as Westpac Bank, St George Bank, National Australia Bank among others that are entering the market.  Another loan product available through SMSF Landers that is a true non-recourse loan requiring no personal guarantees from the trustee or SMSF member and an offering from Mariner Financial with similar attributes.

Many Australians have significant money invested in superannuation with more and more establishing their own Self Managed Super Fund (SMSF).  Many investors would like to be able to include commercial and residential real estate in their superannuation investment portfolio in addition to direct shares and managed funds recommended by most Accountants and Financial Planners.

"SMSF Loans provides SMSF Trustees with control, convenience and cost effective services that are transparent and either bolted together for a total end to end solution or independently offered".  Follow the below steps;

Features of an SMSF Loan

1. It's a simple loan not some complicated Instalment Warrant document or arrangement 
2. We can offer choice as we are a Lender and a Broker I.e. We have every solution available in the market
3. It complies with the requirements of the SIS Act (s67 (4A)) and so is a permitted borrowing
4. Key differences to normal residential or commercial loans
   • Non-Recourse (meaning the lender is limited to recovering the secured real property asset only)
   • The SMSF is the 'Beneficial Owner' until the loan is paid out
   • The Trustee has day to day control of the property
5. It is a Loan to the SMSF to fund the acquisition of eligible income producing real property
   • No construction / refurbishment
   • No Vacant land
6. Loan to value ratios up to 75% of the independent valuation
7. Up to 25 Year loan terms
8. Principal and interest or Interest only periods up to 5 years
9. Variable interest rate or some products have the ability to fix rates up to 5 years
10. The ability to make additional payments at any time
11. You can pay out the loan at any time
12. No personal guarantees required by some products (this is the key difference between most products)
13. No additional credit support required
14. No personal financials required by some products subject to debt servicing by rent / super contributions
15. Limited recourse to the property asset only i.e. no recourse to other assets of the SMSF
16. No impact on your personal credit record 

 

 

**This information is only for general guidance, please consult with expert / professionals for advice on your individual needs and suitability.