Self Managed Superannuation Fund loans

Superannuation legislation allows Self Managed Superannuation Funds (SMSF) to borrow to invest in residential or commercial property.

Investing through your SMSF may be a tax effective way for you to create wealth for your future, and diversify your super investment portfolio. Income from the SMSF, including capital gains, are taxed at concessional rates, so you should end up saving more money for your retirement.

How borrowing for an SMSF property works

If you’re thinking about investing in property through your SMSF, talk to us. We can help explain the process, and help you set up your loan.

The steps are:

• Set up a separate security trust. The security trust buys and holds the property on trust for your SMSF, and provides the guarantee for your loan.
• Borrow up to 70% of the property’s value. We can lend up to 70% of the property value, and the rest comes from your SMSF.
• Paying off the loan. Rent payments flow through to your SMSF and help pay off the loan. Your SMSF has to meet any shortfall.

For more detailed information on the process, view our guide to property investing through self managed super funds.

Who can get an SMSF loan?

Before you consider an SMSF loan:

Seek advice. The rules and regulations for setting up a SMSF are complex. So it’s important to get specialist financial planning, accounting and legal advice to make sure this investment is right for you. You might like to talk to a NAB financial planner.

Review your SMSF documentation: If you already have a SMSF, you’ll need to make sure your fund has the necessary powers to borrow to invest in property. Again, it’s important you seek appropriate advice.

How we can help

Our NAB Tailored Home Loan is available to SMSF trustees who are:

• individuals (provided the security trustee is a company); or
• companies.

Product overview

Loan fees		$600 up front application fee, and $8 monthly service fee. Other fees may be payable.
Variable or fixed rate		Choose either the flexibility of a variable rate or the certainty of a fixed rate for 1-5 or 10 years
Additional repayments1		Unlimited for variable rate loans. During a fixed rate period, up to $20,000 in extra repayments, after that you may be charged economic costs1.
Interest only repayment option2		Up to 5 years interest only in arrears or interest only in advance.
Redraw, repayment holiday, 100% offset, limit increases, split loans.		These features aren’t available for SMSF loans.
Maximum loan to property value	70%	Borrow up to 70% of the property’s value.
Flexible repayment options		Choose from weekly, fortnightly or monthly. For interest only loans, interest is payable annually in advance, or monthly in arrears.
Can be used for building		SMSF loans are only for existing properties.
Available as part of Choice Package		Not available for SMSF loans.
Interest rates		View our current interest rates. We only charge home loan rates, not business loan rates like some other banks.

Want to know more?

Do you have a SMSF and are ready to buy an investment property? Before you start searching, talk to us. We can help you through the process, so you’re ready to start investing in property.

SMSF loans are handled by our Small Business Bankers. Call 13 30 86.