What to consider when investing with an SMSF loan

Considering property investment through your superannuation? A self-managed super fund (SMSF) loan might be an avenue worth exploring.

SMSF loans may help you use your superannuation to invest in property for your retirement.

Here’s what you should keep in mind.

Getting started

Borrowing in your SMSF to buy property requires some forward planning. To set yourself up for success make sure you speak with a lending specialist experienced in SMSF loans.

The right lending specialist can guide you around how much of a deposit you’ll need, any costs associated with the loan and what information, such as trust deeds, the lender will need to review.

Diversification options

Some lenders like Liberty offer SMSF loans for both residential and commercial property investments, giving you more options.

For business owners, it's worth noting that you could potentially lease your SMSF commercial property investment back to your own business.

There are often different loan requirements depending on the type of property you’re buying, so be sure to clarify these upfront.

Navigating changes

Investment strategies, especially for retirement, require a long-term outlook. So, it’s important to prepare for changes in the wider economy or your personal circumstances.

Some lenders offer refinancing options for SMSF loans, which may be helpful if your needs change or repayment challenges arise.

Remember, only the property purchased with an SMSF loan is used as security, not the other assets within your SMSF.

Some finer details

Investing in property through an SMSF comes with a few restrictions around how the property can be used. Additionally, lenders may have different conditions and requirements for their SMSF loans.

Chatting to a Liberty Adviser when you start thinking about an SMSF loan could help you understand your next steps forward.