Borrowing through a self managed super fund is more complex than a standard home loan. The fund can borrow to purchase a residential or commercial investment property, but it must be done under a Limited Recourse Borrowing Arrangement (LRBA).
An LRBA is the structure that allows an SMSF to borrow for investment purposes. It is a specialised area of lending, which is why the setup, lender choice and loan structure all need to be handled carefully.

No. An SMSF investment loan is not treated as personal debt. It is structured as non-recourse debt, with the loan taken out by the Custodian or Bare Trust on behalf of the SMSF.
The lender’s security is generally limited to the property being purchased, which means the debt does not appear on your personal credit file and the lender does not have access to your personal assets or other assets within the SMSF if the fund defaults. This is a key part of the LRBA structure and one reason SMSF lending is so specialised.

The amount an SMSF can borrow will depend on the type of property and the lender’s policy.

• For standard residential SMSF loans, borrowing is typically available up to 80% of the property value.
• For commercial property, most lenders will generally allow borrowing up to 70%, with few allowing up to 80%.

At Raise The Bar Finance, we help you understand your borrowing capacity based on the property type, available deposit and lender requirements.

That will ultimately depend on the lender, but in general both residential and commercial property may be acceptable security types for SMSF lending.
The lender will assess the property based on its own policy, valuation requirements and how well it fits within their SMSF lending criteria.

Yes. In many cases, an SMSF can use a property loan to purchase a property anywhere in Australia, provided the property meets the lender’s criteria and is considered a single acquirable asset under the relevant rules.
At Raise The Bar Finance, we help you navigate the lending, legal and valuation requirements that may apply when purchasing interstate, while keeping the structure compliant.

SMSF loan interest rates are generally higher than standard residential mortgage rates. This reflects the more specialised and complex nature of borrowing inside a super fund.
The actual rate available will depend on the lender, the property type, the loan structure and the overall scenario.

Yes. Like other property loans, SMSF loans may be available with fixed or variable interest rates.
The right option will depend on your fund’s cash flow needs, risk appetite, view on interest rates and overall investment strategy. At Raise The Bar Finance, we help you understand which rate structure may be the better fit for your fund.

An offset account can form part of an SMSF lending strategy in some cases. It works by linking a cash account to the loan, with the balance in that account offsetting the loan balance for interest calculation purposes.
This can reduce the interest charged on the loan while also helping keep cash accessible for future needs or investments. At Raise The Bar Finance, we help you assess whether using an offset facility is appropriate for your SMSF strategy and options available. 

Loan repayments should generally be made from the SMSF’s bank account. That bank account does not need to be held with the same lender providing the SMSF loan.

Once the SMSF has been established, the next steps usually involve progressing the lending side, working through the investment strategy and making sure the structure remains compliant.
At Raise The Bar Finance, we help guide you through the lending process and can connect you with the right professionals where needed.

A corporate trustee can provide a number of benefits for an SMSF, including stronger asset separation, easier changes to membership, and additional compliance advantages.
It is often the preferred structure for many SMSFs, particularly where property investment is involved.

A standard SMSF setup often takes around 4 to 8 weeks, depending on documentation, approvals and the professionals involved.
The process generally includes establishing the fund and trust structure, obtaining an ABN, opening the SMSF bank account and rolling over existing super balances. We connect you with the right professionals who can guide this process end to end.

One of the main differences comes down to the security property and how lenders assess risk.
Residential properties are generally easier to value and are often seen as less volatile than commercial properties. Commercial properties can involve more risk from a lender’s perspective, which is one reason commercial SMSF loans usually carry higher interest rates than residential SMSF loans.

SMSF lending is a specialised area, and many mainstream lenders take a more conservative view of the risks involved.
Some of the key reasons include:

• The limited recourse nature of LRBAs, which restricts the lender’s claim to the specific property
• The added complexity of the legislation surrounding SMSF borrowing
• The different risk profile of certain asset types, particularly commercial property

Because of this, the pool of lenders is much smaller than it is for standard residential lending, making the right lender selection even more important.

SMSF lending is no longer widely offered by the major banks, so the available lender panel is more limited. The lender options can also differ depending on whether the property is residential or commercial.
At Raise The Bar Finance, we help you understand which lenders are active in the SMSF space and which options may suit your scenario.

Like a standard property loan, an SMSF loan will usually involve fees and charges, along with an interest rate.
The exact costs will depend on the lender, loan type and property, and it is important to understand these upfront as part of the overall lending strategy.

Once the SMSF property loan has been fully repaid, the role of the Custodian or Bare Trust is complete. The legal title to the property can then be transferred from the Custodian Trustee to the SMSF Trustee.