Why Choose Greenline Home Loans for SMSF Loans?
A Self-managed Super Fund Loan is a great way to leverage your superannuation into an investment property to secure your future. Greenline Home Loan’s SMSF loans are designed to cater to a wide range of investors, and we can consider both residential and commercial properties on a loan term of up to 30 years. We understand that depending on the location of your property you may find it difficult to obtain approval for your SMSF loan with other lenders. Rest assured, Greenline’s product caters for inner-city properties as well as high-density and regional properties.
Our competitive loans are ideal whether you a purchasing a property or looking to refinance. Here at Greenline Home Loans, we accept applications for both new SMSFs and established SMSFs. Unlike other lenders, Greenline’s unique product does not have a minimum balance required and accommodates for SMSFs without liquidity and a cash buffer. Greenline’s SMSF loans can be either variable or fixed, and investors can choose to make interest-only repayments or make both principal and interest repayments.
Our unique variable product allows you to make unlimited extra repayments and gives you access to a 100% offset account on all your variable loans. You will have the ability to be able to customise your loan to your own preferences by creating multiple splits with no extra costs. Plus, our market-leading and user-friendly platform provides you with full access to your SMSF loans and your transaction accounts, along with unlimited transactions on all your accounts.
Residential and Commercial Product and Security Summary
Residential and Commercial Properties Product Summary
Residential and Commercial Properties Maximum Loan Size and LVR Matrix
Residential and Commercial Properties Maximum Loan Size and Repayment Type Matrix
Residential and Commercial Properties Maximum Loan Terms
Residential Properties Acceptable Loan Purpose
Commercial Properties Acceptable Loan Purpose
Commercial Properties Maximum Loan to Valuation Ratio’s
Acceptable Commercial Property Types
Standard Commercial Properties are properties that are used for business purposes. This includes owner occupier, leased from related entity and tenanted properties. The acceptable commercial property security types include:
- Strata Offices & Showrooms (minimum area 30 m²)
- Retail outlets (e.g. shops, restaurants)
- Industrial Units/Factories
- Industrial Warehouses
- Mixed Residential & Commercial Use
- Residential Properties (≥ 3 or more on one title)
- Industrial Workshops
- Medical/Dental Suites
- Childcare Centres
- Serviced Apartments
- Boarding Houses
- Student Accommodation
- Display/Exhibition Homes
- Strata Retirement Units
- Function Halls
Unacceptable Commercial Property Types
Origin MMS does not accept commercial properties for security that is specialised or has a very limited market. The unacceptable commercial security types include:
- Hotels and pubs
- Quarries & mines
- Swimming Pools
- Caravan Parks
- Churches / Places of worship
- Rural Acre > 25 hectares
- Vineyards / Wineries
- Golf Courses
- Sporting Centres
- Theatres / Cinemas
- Theme Parks
- Gaming Centres
- Recording/Film studios
- Funeral Parlours
- Vacant Land
Frequently Asked Questions.
What is a Self-Managed Super Fund?
A self-managed super fund is a super fund that you can manage on your own. Self-managed super fund loans allow for greater flexibility and permit investors to hold various assets such as shares, term deposits, cash and investment properties.
An SMSF can be very successful, although it does come bearing more risk compared to a regulated super fund. SMSFs can have up to four members and is in need of their own separate Tax File Number (TFN), Australian Business Number (ABN) and transactional bank account. Also, due to the fact that SMSFs are a type of trust, you must assign a trustee to have authority over the investment strategy, administrative tasks and financial statements.
What is a Self-Managed Super Fund Loan Application?
An SMSF loan application is a document that is required to get your loan approved. Each lender may require different documentation, but many will ask for copies of the SMSF trust deed, the custodian trust deed and the contract of sale.
For this application, you will also be required to show proof of sufficient personal income, bank statements, tax returns and audit certifications. This information will aid the lender in ensuring that everything is in order and that you are able to afford certain loan repayments.
How Much Can You Borrow on a SMSF Loan?
The amount of money you can borrow on an SMSF loan greatly depends on your financial situation as well as your lender and their policies. Depending on your lender, they can offer SMSF loans ranging from $100,000 up to $4,000,000. Greenline Home Loans offers maximum loans up to $2,500,000 for one security with maximum exposure of up to $4,000,000. Get in contact with our lenders today if you require a larger loan amount.
It may also be necessary to preserve a minimum amount within your SMSF after the sale of your property. This minimum amount may vary according to your individual circumstances.
Some lenders may also require you to keep a specific percentage of liquid cash. However, depending on your lender, it may be possible that they will waive this if the initial deposit is large enough or if the rental income covers the loan repayments.
Can You Get Cash Out/Equity Release from My Current SMSF Property?
Under the ATO ruling, once you purchase a property, you will not be able to refinance to get cash-out or use it as equity to purchase another property. The only way to get access to your equity will be to sell your property. If you have an existing investment property in your SMSF and you would like to buy another one, you will need to have enough funds in your SMSF to contribute the deposit and purchasing costs.
What Type of Lending is Required for SMSF Loans?
All lending in SMSF loans is required to be through a limited recourse borrowing arrangement (LRMA). Limited Recourse Borrowing Arrangements involve a self-managed super fund trustee taking out a loan from a lender. This trustee then uses these funds to purchase a single asset that is to be held in a separate trust. Any investment returns that are made from the asset go towards the SMSF trustee. If the borrower fails to pay principal or interest on their SMSF loan, the lender’s rights are limited to the asset held within the separate trust. This means that there is no recourse to the other assets that are held in the SMSF.
What are the Requirements of an SMSF Loan?
When it comes to applying for an SMSF loan, there are four main requirements:
- The sole purpose of the property must be to provide retirement benefits or death benefits to SMSF beneficiaries
- If it is a residential property, the property must not be obtained from a member of the SMSF or any related party of a member.
- If it is a residential property, a member of the SMSF or any related party of a member must not be lived in or rent the property.
- The property must not be a single obtainable asset.
What Does LVR mean?
Loan-to-value ratio (LVR) makes reference to how much you are borrowing in comparison to the value of the property. When you have a larger deposit, it means you will have a lower LVR. A lower LVR means that there is less risk to the lender. Depending on your lender, the maximum LVR for SMSF loans may vary.
Can I Refinance with an SMSF Loan?
It is possible to refinance your current SMSF loan, although few lenders offer SMSF loan for this very purpose. Many borrowers have taken out SMSF loans when interest rates were recorded higher or when their financial situation was different. In these instances, it is well worth looking into refinancing your SMSF loan in order to seek out if there are better options for your individual needs.
How Much Can I Borrow to Purchase a Residential SMSF Property?
Here at Greenline Home Loans, we offer up to 80% LVR for residential properties. For example, if you buy a residential property for $400,000, your maximum loan amount is $320,000. Therefore, you will require $80,000 in SMSF cash to complete a purchase, plus acquisition and loan costs.
How Much Can I Borrow to Purchase a Commercial SMSF Property?
Here at Greenline Home Loans, we offer up to 80% LVR for commercial properties. For example, if you buy a commercial property for $400,000, your maximum loan amount is $320,000. Therefore, you will require $80,000 in SMSF cash to complete a purchase, plus acquisition and loan costs.
What Costs Are Involved with SMSF Loans?
Generally, the following fees will apply to an SMSF Loan:
- Application fee
- Valuation fee
- Legal fees
- Monthly Administration/Service fees
- Early repayment fees
Can My SMSF Loan Have an Offset Account?
Yes, however, only certain lenders offer an offset account. Greenline Home Loans offers a 100% offset account on SMSF loans. An offset account is a valuable feature for an SMSF loan as the cash held by the SMSF will offset the loan balance, which ultimately reduces your monthly interest repayments.
Apply for a SMSF Loan Today!
Are you ready to leverage your superannuation into an investment property to secure your future? Speak to one of our expert lenders here at Greenline Home Loans. We’re here to help!