Before you open an SMSF, our brokers can help you check if your eligible for a loan, max servicing and ways to improve your SMSF file and borrowing.
A SMSF has a high set up cost and ongoing cost, you should have a minimum balance of $150,000 to make it worthwhile financially to buy under a SMSF.
Most lenders prefer if you have a corporate trustee.
Advantages of a SMSF
- Can be used to buy residential and commercial properties
- Has no impact on your personal borrowing capacity
- Depending on the purchase and property type, it may have a tax advantage
- You have control on the asset and investment you want to invest in
- Asset protection – It’s part of a non-recourse loan, so your personal asset and money in your separate retail superannuation funds are protected (seek independent legal and accounting advice)
- For business owners, you can use the commercial property for your own business purposes (seek independent legal and accounting advice)
Disadvantages of a SMSF
- High set up cost, ongoing cost and exit fee
- Limited choice of lenders
- Interest rate is generally higher
- For residential property, you can not live in the property
- Investment only
- Construction loans are not available
- Restrictions on the type of property you can invest
Please seek independent legal and accounting advice.
Our brokers personally have properties under their SMSF and understand the complexities and struggle of buying in a SMSF , but rest assured we will guide you through out each step.