Can a SMSF Have a Margin Loan?
SMSF members researching the various loan options available to them may wonder if SMSF can have a margin loan. Theoretically, yes, an SMSF can have a margin loan as long as the funds borrowed take place using a Limited Recourse Borrowing Arrangement (LRBA). An LRBA is an arrangement that strictly limits the lender’s rights to the security asset against the assets offered by the borrower as a form of security.
Self-managed super funds are privately managed funds with the purpose of benefiting the SMSF member’s retirement savings. SMSF is used to make specific investment purchases that generate a returned profit. The returned profit is then allocated amongst the member’s retirement savings and can be accessed once a member meets retirement age.
Unfortunately, a large majority of Australia’s big banks and mortgage brokers no longer offer SMSF loans. However, there are still a few lending specialists offering SMSF loans, including the following:
- Mortgage House
- Liberty Financial
- Reduce Home Loans
- La Trobe Financial
- Switzer Home Loans
SMSF loans can be used to make a variety of investment asset purchases that fall within the Australian Taxation Office’s rules and regulations, including:
- International and Australian shares
- Term deposits
- Overseas investments
- Managed funds
- Non-related businesses
- Cash and bonds
- Residential and commercial properties
If you would like to learn more about SMSF margin loans, management techniques, and investment opportunities, reach out to the experienced Mortgage House professional lending specialists for specialized assistance and advice for successfully reaching your desired retirement goals.