Superannuation Home Loans
Because the Superannuation Industry Supervision Act 1993 (SIS ACT) was amended in September 2007 you can now borrow in order to make property purchases. This means that Self Managed Super Funds (SMSF) can be used to purchase property without sufficient funds to complete the purchase outright, and take advantage of gearing options available to regular property investors.
With your self managed super fund you can invest in any type of property inclusing residential, investment and retail. Once the property to be invested in has been chosen, your SMSF must only purchase real estate from a member or related entity for business purposes – any residential property must be purchased from an arm’s length vendor.
How it all works:
- First, obtain a loan approval
- The SMSF will use a lawyer/conveyancer to act on the purchase the same way as any other property purchase. The purchase MUST be in the name of the Property Trustee.
- The SMSF pays the deposit, the balance purchase money (less the amount borrowed), the legal costs, and stamp duty in the ordinary way.
- On completion of the purchase the Property Trustee mortgages the property to the lender.
- SMSF then manages the asset in the same way as you would with any other real estate investment.
- Loan repayments work in much the same way as a usual loan.
- The SMSF is able to pay out or reduce the mortgage at any time (subject to the terms of the relevant loan).
- Once the mortgage is paid out in full, title to the property can be transferred to the SMSF or the Property Trustee can continue as registered proprietor.
Not all banks offer an opportunity in this way so you will need to shop around and be careful who you choose. A mortgage broker can help you with comparisons and will have access to many different lenders who can help you. Want to find out more? Call today and talk to your local mortgage broker on 
or fill in youe details on line: