SMSF Lending: Some Banks Will, Some Won’t

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smsf property investment

For some, SMSF lending is a growth area.

SMSFs can be a tax-effective means of property investment.

Some lenders see SMSF loans as a growth opportunity and are chasing them aggressively and some borrowers see them as a further opportunity to expand their property portfolio.

But SMSF lending is not for everyone; some banks (such as ANZ) simply do not lend to Self Managed Super Funds.

And SMSF lending is not for every borrower; typically SMSF loans have higher rates and fees (and more paperwork) than a normal home loan.

Because the banks are dealing with your retirement savings, they tend to be more conservative and will lend less than if you invest in a property in your own name.

Below is a summary of maximum lending policies.

Max Loan Value Ratio

Commercial Property

Max Loan Value Ratio

Residential Property

In Super 65% 70%
In Your Own Name 70% 95%


SMSF loans also tend to have higher interest rates than normal residential loans.  But, given the low tax environment of superannuation, they can still pay-off for many.

The other key difference is the (lack of) availability of an offset account.  Offset accounts are key tools on reducing the amount of interest we pay.  Yet only AMP and St George offer such accounts.

Most Australians pay 15 per cent tax on their superannuation (whereas the highest individual tax rate is 45 per cent), so SMSF can be a tax effective investment strategy.  But SMSF lending is not a case of walking into your local bank and arranging a loan.

If you want to know more about SMSF lending, please contact your C&N Finance broker today.

Doug Daniell - Chan & Naylor


Doug Daniell

Disclaimer: This article contains general information; before you make any financial or investment decision you should seek professional advice to take into account your individual objectives, financial situation and individual needs. Click for more detail regarding this disclaimer.

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