About Us
When it comes to borrowing money for a Self-Managed Super Fund, the process is quite different from getting a traditional bank loan. Before you begin, it is essential to understand the fundamentals, and for this, we always suggest meeting with your accountant or financial counsellor.
We have helped customers secure financing for residential or commercial property via their super funds.
The SMSF Limited Recourse Borrowing Arrangement is required to borrow money inside the SMSF (LRBA). Before you begin, it is essential to understand the fundamentals, and for this, we always suggest consulting with your accountant or financial counsellor. SMSF loan 360 will help you with your SMSF borrowing requirements and open the door to a new world of investing options.
Returns from the investment, which might be either capital gains or rental payments, are deposited into your superannuation fund. The SMSF limited recourse borrowing arrangement is required to borrow money inside the SMSF (LRBA). You'll need to be sure that the investment loan is organised appropriately before you take out one. We always suggest consulting with your accountant or financial counsellor to obtain a better grasp of the fundamentals before getting started. . SMSF loan 360 can help you with your borrowing requirements and open a new world of investing options.
Requirements for the SMSF Loan to be Compliant
All self managed super fund loans must comply with the regulations set by ASIC. The SMSF trustees need to ensure the borrowing structure is compliant by taking into consideration SISA and other tax rules:
Limited Recourse
The loan must be a limited recourse loan between the lender and the SMSF.
Loan Agreement
A commercial loan agreement need to be formally executed if the SMSF borrowing is from a related party.
Setup Trust
A custodian/bare trust with a corporate trustee has to be set up correctly. The corporate trustee for the bare trust must be the registered owner of the property or other assets.
Concerns from ATO
The ATO’s concern about the self managed super fund borrowing should be noted:
- Sole purpose test may fail if all members are in pension phases.
- If the fund borrows to construct, develop or refurbish the property, this is not allowed in this SMSF borrowing arrangement.
- The interest rate can’t be on a commercial basis for the borrowing from related parties.
- The asset to be purchased needs to be allowed by the law
All loans for self-managed super funds must adhere to Limited Recourse Borrowing Arrangements (LRBA). The SMSF trustees must verify that the borrowing arrangement is compatible with SISA and other tax requirements.
- The loan must be between the lender and the SMSF as a limited recourse loan.
- A proper custodian/bare trust with a corporate trustee must be established. For a bare trust, the corporate trustee must be the registered owner of the property or other assets.
- If the SMSF borrows from a related party, a commercial loan arrangement must be duly completed.
- The interest rate on borrowing from related parties must be commercially reasonable.
- The asset to be bought must be permitted by law.
Why use us ?
Purchasing an investment property is a complicated and possibly stressful process. Appointing a skilled mortgage broker will ensure that the necessary groundwork has been completed and that the finest lender and offer have been selected.
Limited recourse borrowing arrangements available to SMSFs are complex due to the specific requirements, legislative issues and lender limitations imposed on this type of loans. SMSF loan 360 expertise in the field of SMSF mortgage broking services.
SMSF loan 360's strong grasp of the legal and regulatory requirements involved with SMSF loans, as well as its expertise of the lending markets, enables it to deliver the fastest and most cost-effective loan solutions.
Being independent and not affiliated with any lender we recommend lenders from the whole of the market, making sure the most suitable loan is tailored for the customer.
We recommend that you have an initial consultation with us before you start looking for a property to get an idea of how much you will be able to borrow, whether the investment property address postcode is acceptable to lenders, and, most importantly, whether your SMSF structure and current trust deed allow LRBA.