SMSF Home Loan rates from 6.97%

Looking to refinance your SMSF home loan? We compare some of the best rates and features from leading lenders.

Brooke Cooper
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LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.99% p.a.
7.00% p.a.
$2,659
Principal & Interest
Variable
$0
$230
70%
Featured
  • Available for Purchase and Refinance. No application fee and no settlement fee
  • No monthly, annual or ongoing fees
  • Access your SMSF loan via our easy-to-use online app Smart Money
6.97% p.a.
6.97% p.a.
$2,653
Principal & Interest
Variable
$0
$500
70%
  • No fees for Refinance only (Excluding gov. charges)
  • Includes a 100% offset account and flexible repayment options
  • Build and manage your own nest egg with a Self-Managed Super Fund
7.19% p.a.
7.74% p.a.
$2,712
Principal & Interest
Variable
$395
$1,185
60%
  • Fully functioning offset.
  • Rapid Refinance available - receive approval in as little as 48hrs
  • 50m2 of beach & coastline cleaned with every loan settled.
7.24% p.a.
7.25% p.a.
$2,726
Principal & Interest
Variable
$0
$0
70%
7.75% p.a.
7.83% p.a.
$2,866
Principal & Interest
Variable
$0
$995
80%
7.49% p.a.
8.04% p.a.
$2,794
Principal & Interest
Variable
$395
$1,185
80%
  • Fully functioning offset.
  • Rapid Refinance available - receive approval in as little as 48hrs
  • 50m2 of beach & coastline cleaned with every loan settled.
7.55% p.a.
7.94% p.a.
$2,811
Principal & Interest
Variable
$395
$1,920
80%
7.74% p.a.
7.75% p.a.
$2,863
Principal & Interest
Variable
$0
$0
80%
8.19% p.a.
9.11% p.a.
$2,988
Principal & Interest
Variable
$395
$1,185
90%
  • Fully functioning offset.
  • Rapid Refinance available - receive approval in as little as 48hrs
  • 50m2 of beach & coastline cleaned with every loan settled.
7.49% p.a.
7.50% p.a.
$2,794
Principal & Interest
Variable
$0
$230
80%
Featured
  • Available for Purchase and Refinance
  • No application fee and no settlement fee
  • No monthly, annual or ongoing fees
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of .


June SMSF Rates Top Picks

Interest rates for SMSF loans are generally higher than those for standard home loans. However, with the cash rate appearing to have peaked at 4.35%, SMSF loan repayments might soon start to decrease gradually.

Several SMSF lenders are open to considering refinancing options. If you haven’t reviewed your loan in some time, now might be the perfect time to explore the market and see all your options.

Here are some of the lowest rates on SMSF loans in our database for this month.

Best SMSF rates from our database

Brand

Product

Advertised rate % per annum

Comparison rate % per annum

Reduce Home Loans

Capitalizer SMSF Refinance - LVR ≤60% & 65-70%

6.79%

6.79%

loans.com.au

loans.com.au SMSF 70 - LVR ≤70%

6.99%

7.00%

Homestar

Star Blue SMSF Refinance Special - LVR ≤70%

6.99%

7.05%

WLTH

WLTH Ocean SMSF 70 - LVR ≤70%

7.19%

7.74%

Firstmac

SMSF 70 - LVR ≤70%

7.24%

7.25%

Rates correct as of 1 June. Rates may differ to comparison table above.

What is an SMSF loan?

If you're a trustee of a self-managed super fund (SMSF), you could take advantage of a SMSF home loan to invest in property.

Purchasing property in Australia can be a pricey endeavour, but using an SMSF home loan can make this asset class more accessible.

How does an SMSF loan work?

SMSF loans and Limited Recourse Borrowing Arrangements (LRBAs) are one and the same.

As the name suggests, a bank or lender offering LRBAs has limited means of recourse if a borrower defaults.

If a default were to occur, an SMSF lender can only repossess the asset used as security against the loan - the property purchased - which will be held in a separate trust. It cannot recoup any losses from the broader SMSF or the members themselves.

Which lenders offer SMSF loans?

Not every bank or lender will offer SMSF home loans. Here are some that do:

    How much money does an SMSF need in order to buy property?

    A lender will typically require an SMSF to have a balance of around 20% of a property's value before providing a loan for the remaining amount. This is mainly to ensure the fund can cover any expenses that may arise after settlement.

    How does the SMSF loan application work?

    Applying for an SMSF loan works similarly to applying for a regular home loan, though there may be some noticeable differences.

    Here is how an SMSF loan application generally works:

    1. Identify the right property for a fund to invest in
      This process should see trustees considering factors such as potential capital gains, rental income, and market value, while ensuring the investment aligns with the fund's investment strategy. Remember, all assets purchased by a SMSF must be held 'at arms length' from all members, meaning neither yourself nor your relatives can live in or otherwise use a SMSF asset.

    2. One trustee will act as a custodian
      This person will hold the property title on behalf of the fund until the SMSF loan is paid off.

    3. The custodian submits the required documentation
      This person will also be responsible for putting together the information needed by a bank or lender as part of the home loan application.

    4. The custodian will put the property up as security
      This step will occur after the bank green lights the application.

    5. Stamp duty and other legal fees must be paid
      Purchasing property through a SMSF doesn't mean bypassing other requirements of property investing, such as transfer duty and conveyancing fees.

    6. Repayments begin
      Repayments on the SMSF loan can be made after settlement, with rental income used to pay off the loan. In cases where the rental income isn't enough to cover repayments, SMSF contributions can be used in tandem.

    7. Finally, the property's title will be transferred to the SMSF once the loan is paid off

    SMSF home loans: Pros and cons

    Leveraging an SMSF to invest in property offers several benefits, including the opportunity to grow the fund's value. However, there are also downsides to using SMSF loans.

    Pros

    • Rental income is used to pay off the loan
      Properties purchased under an SMSF loan can pay for themselves, as rental income can be funnelled towards repayments.

    • Diversification
      An SMSF borrowing money to purchase property can diversify its holdings while limiting risk, as the nature of SMSF loans means that, in worst-case scenarios, a lender can only repossess the asset secured against the loan.

    • Access to higher-value properties
      By utilising an SMSF loan, an SMSF can invest in higher-value properties than it otherwise could, including properties that may exceed the value of the fund itself.

    • Borrowed funds can be used to cover repair costs
      SMSF loans can be used to repair existing fixtures and fund maintenance works in a property owned by the SMSF.

    • Tax benefits
      SMSFs are typically taxed at a rate well below most Australians' marginal tax rates and can realise capital gains tax discounts.

    • Lower-risk SMSF borrowing arrangement
      SMSFs can borrow funds to invest in assets other than property, with such loans called margin loans. Margin loans can attract margin calls if the value of an SMSF's portfolio dips below a certain level, a stock they hold is suspended from trading, or its lender changes its policiesThat's not the case for SMSF home loans.

    Cons

    • Time and effort
      Getting an SMSF up and running is already tedious, and adding an SMSF loan and investment property will likely make matters more complicated. While the fund can hire professionals to get things done, the responsibility of ensuring everything meets compliance standards ultimately falls on the trustees' shoulders

    • High interest rates compared to broader market
      SMSF loans typically attract higher interest rates than standard investment home loans

    • Properties can't be improved using borrowed funds
      While SMSF loans can be used to repair and maintain the property, they cannot be used to make additions to the property, like building a granny flat or extending rooms

    • Heightened risks
      SMSF property investments are considered riskier given the compliance requirements needed to securely carry out property investments

    • Smaller pool of potential lenders
      Many lenders, including the big four banks, don't offer SMSF loans, so a fund seeking a lender will have fewer options to choose from

    Starting your SMSF journey

    Embark on your self-managed super fund (SMSF) journey with confidence!

    Follow our guides to establish your SMSF, understand the role of an SMSF administrator and adviser, and choose the right trustee structure for your fund:

    6 Steps to Establishing your SMSF Fund

    What is an SMSF administrator?

    How to choose an SMSF adviser

    Choosing your SMSF trustee structure

    Navigating SMSF costs

    Understanding the fees and expenses associated with self-managed super funds (SMSFs) is essential for prudent financial management.

    Learn how capital gains tax works within SMSFs, grasp the auditing process to ensure regulatory compliance, and master the rules governing SMSFs for effective fund management:

    How does capital gains tax in SMSFs works?

    The things you need to know about auditing your SMSF

    What are the rules governing SMSF?

    Advanced strategies for seasoned SMSF holders

    Maximise your SMSF's potential with advanced strategies.

    Learn how to purchase property via your SMSF, mitigate risks, and build a comprehensive investment strategy tailored to your financial goals:

    Buying a property with your SMSF

    Risks in managing SMSFs and how to avoid them

    Building Your Investment Strategy from Scratch

    Frequently Asked Questions

    Your Mortgage's answers to the most frequently asked questions regarding SMSFs

    Just like any superannuation fund, an SMSF can be used to invest and save for your retirement. Contributions made to the SMSF, along with any profits generated by its investments, can be accessed once you reach the appropriate retirement age.

    Unlike traditional superannuation funds, an SMSF is controlled by its members, who can also act as trustees. This means members have the flexibility to choose and manage their investments, provided these investments align with the SMSF’s investment strategy and comply with superannuation laws.

    Members can invest in a wide range of assets, including shares, property, and cash, depending on what they believe will offer the greatest benefits over time. However, all investment decisions must be made in accordance with the SMSF’s investment strategy.

    A self-managed super fund (SMSF) is a ‘do-it-yourself’ super option, allowing individuals to manage their own superannuation funds. Setting it up involves several steps:

    1. Assemble members and appoint trustees
      You need to determine the members of your SMSF. For an individual trustee structure, there must be at least two trustees, whereas a corporate trustee can have one or two directors.

    2. Create the trust and trust deed
      Establish the SMSF by creating a trust. The trust deed is a legal document that sets out the rules for establishing and operating the fund.

    3. Register with the Australian Tax Office (ATO)
      Register your SMSF with the ATO to obtain an Australian Business Number (ABN) and a Tax File Number (TFN). You must also elect for the fund to be regulated by the ATO to receive tax concessions.

    4. Open a dedicated bank account
      Set up a bank account in the name of the SMSF to manage contributions, investment income, and expenses.

    5. Obtain an Electronic Service Address (ESA)
      This is required to receive contributions and rollovers electronically via SuperStream.

    6. Prepare an investment strategy
      Develop an investment strategy that considers the fund's circumstances and objectives, ensuring it complies with superannuation laws.

    If you’re unsure of the process, it may be beneficial to seek advice from a qualified SMSF professional. Incorrect setup of an SMSF could result in missing out on valuable tax concessions and other benefits

    How much you can borrow with your SMSF depends on the structure and type of investments.

    When investing in residential property, an SMSF can typically borrow a maximum of 65% to 80% of a property’s value.

    Put simply, yes you can live in a property that was previously owned by your SMSF once you retire.

    However, you cannot live in a property owned by your SMSF at any point. If a property is owned by a SMSF, it must pass the ‘sole purpose test,’ meaning it must solely provide retirement benefits to the SMSF members. Living in the property would breach this test.

    To live in the property, it must be transferred out of the SMSF into your personal ownership. This is called an in specie transfer and can happen after you reach preservation age and meet a condition of release (for instance, retirement).

    This process involves selling the property to yourself at market value and complying with all relevant legal and tax requirements.

    If you wish to live in your SMSF’s property after you retire, it could be a good idea to receive advice from an SMSF professional.

    A self-managed superannuation fund (SMSF) is a type of superannuation fund that allows you to manage your retirement savings yourself. As a trustee of the SMSF, you have control over the investments made by the fund. Any contributions and profits generated will benefit you and the other members in retirement.

    Unlike traditional superannuation funds, where investment decisions are made by professional fund managers, SMSFs provide members with the autonomy to make their own investment choices. This flexibility can be advantageous for those who prefer a hands-on approach to managing their retirement savings, but it also entails significant responsibilities to ensure compliance with superannuation laws and effective management of the fund.

    SMSF Guides

    ...

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