12 Aug 2021

What Should I Know Before Talking to a SMSF Mortgage Broker?

Low Deposit Home Loan: Who Qualifies and What is it?

If you are interested in purchasing a property through your Self-Managed Super Fund, you need to work with an experienced mortgage broker. You need to work with a mortgage broker because there is a big difference in fees and interest rates on SMSF loans between lenders, unlike standard home loans. Another reason is that many major banks process these loans through their commercial or business banking department, resulting in higher costs and more expensive loans. Finally, not all lenders will provide you with an offset account, which is beneficial if you have a lot of cash in your fund. Working with a mortgage broker can ensure you get the best loan possible with competitive rates and valuable features. 


Things You Should Know

Before talking to a Mortgage Broker, there are some general things you should know. 


  • Loan restrictions: You need to know which loans are restricted with SMSFs. Some restricted loans include construction, vacant land loans, and owner-occupied home loans.
  • Buffer: Most lenders will require you to have at least a 10% buffer in your fund. This 10% of the property value should be liquid assets, such as cash or company shares. 
  • Minimum Amount: Some lenders won’t lend to SMSFs if their fund has less than $300,000 in assets. You need to know how much money your fund has and how much its assets are worth. 
  • Tax Implications: Does buying a property make sense with your current financial situation? Do the tax implications make purchasing a property cost-effective? Before consulting with a mortgage broker about purchasing a property, you should consult with a financial expert. 


If you have consulted with a financial expert specialising in SMSFs and are ready to purchase a property, the brokers at Mortgage House are here to help. We can help you find a home loan with the most competitive rates, the best features, and without costly fees. 


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