SMSF Lending Advice
What SMSF lending advice involves
An SMSF has never been able to borrow freely. Where borrowing was permitted, it had to be done through a limited recourse borrowing arrangement, a structure where the asset is held in a separate trust and the lender’s claim is generally limited to that asset rather than the fund’s other assets.
From 10 August 2026, new limited recourse borrowing arrangements are generally no longer available to acquire residential property.
Three things this does not change:
Existing arrangements continue. If your fund already has an arrangement in place, it is grandfathered. There is no requirement to unwind or sell.
Contracts signed before commencement are protected. Where a contract of purchase was entered into before 10 August 2026, the arrangement is protected even if settlement occurred afterwards.
Commercial property borrowing is unaffected. Where a property satisfies the business real property test, borrowing remains available. For business owners, this is the part that matters most.
How a mortgage broker helps with SMSF lending
Commercial property for your own business
The most common remaining use. A business owner’s fund acquires the premises the business operates from, and the business pays rent to the fund. Whether a property qualifies as business real property is a technical question, and mixed use or vacant premises are not automatically included. Your accountant and SMSF adviser determine whether the property qualifies. We determine whether and how it can be financed.
Refinancing an existing arrangement
Existing arrangements can generally be refinanced, though a material change, which may include changing lenders, can affect the grandfathering. This is worth checking carefully before acting, because the consequence of getting it wrong is losing the protection.
Understanding what your fund can still do
An SMSF can still acquire residential property outright using the fund’s own cash, subject to its investment strategy and the usual superannuation rules. What has changed is borrowing to do so, not owning.
Lender requirements
Fewer lenders operate in SMSF lending than in ordinary property lending, and their requirements are stricter: larger deposits, tighter servicing tests, and specific documentation about the fund and its trust deed. Knowing which lenders are active in this space, and what each requires, saves considerable time.
Working with your accountant and SMSF adviser
SMSF borrowing sits at the intersection of superannuation law, tax and credit. We do not provide superannuation or tax advice, and establishing or contributing to an SMSF requires an appropriately licensed adviser. Our role is the finance. We work alongside your existing professionals, or alongside a Viridian financial adviser if you would like us to introduce one.
Speak to our experienced team today.
SMSF lending by situation
1 – You own a business and want your fund to buy the premises
The clearest remaining case for SMSF borrowing, and one that is unaffected by the change.
2 – You already have an SMSF loan on a residential property
Nothing needs to change. Your arrangement is grandfathered. Refinancing is possible in many cases, but a material change may affect the protection, so check before you switch.
3 – You signed a contract before 10 August 2026
Your arrangement is protected even if settlement occurred later.
4 – You were planning to buy residential property through your fund
That option is generally no longer available through borrowing. Your fund can still acquire residential property outright with its own cash, subject to its investment strategy.
5 – Your fund holds commercial property and you want to refinance
Available, though the lender pool is narrower than in ordinary commercial lending.
Who this is for
- Business owners whose fund is acquiring or refinancing business premises
- Trustees with an existing arrangement considering a refinance
- Trustees who want to understand what the change means for their fund
Who this isn’t for
- Anyone seeking advice on whether to establish an SMSF. That requires an appropriately licensed adviser, and we can introduce you to one.
- Anyone seeking tax or superannuation advice. We provide credit assistance only.
Our advice process
01 Evaluation
02 Discovery
03 Strategy
04 Implementation
05 Review
SMSF Lending FAQs
Can an SMSF still borrow to buy property?
For commercial property that satisfies the business real property test, yes. For residential property, new borrowing arrangements are generally no longer available following the change that commenced on 10 August 2026. Existing arrangements are unaffected.
What happens to my existing SMSF loan?
Nothing. Existing limited recourse borrowing arrangements are grandfathered and continue under the previous rules. There is no requirement to unwind, sell or repay early.
Can I refinance an existing SMSF loan?
In many cases yes, though a material change to the arrangement, which may include changing lenders, can affect whether the grandfathering continues to apply. Because the consequence of getting this wrong is significant, it is worth confirming the position with your accountant and adviser before acting.
Can my SMSF still own residential property?
Yes. The change affects borrowing to acquire residential property, not owning it. A fund can still purchase residential property outright using its own cash, subject to its investment strategy and the usual superannuation rules.
What is a limited recourse borrowing arrangement?
It is the structure that allows an SMSF to borrow. The asset is held in a separate trust while the fund holds the beneficial interest, and the lender’s claim is generally limited to that asset rather than the fund’s other assets. It is the only borrowing structure SMSFs have been permitted to use.
What is business real property?
Broadly, property used wholly and exclusively in a business. It is a technical test, and properties such as mixed use premises or vacant commercial sites are not automatically included. Whether a specific property qualifies is a question for your accountant or SMSF adviser rather than a broker.
Why do fewer lenders offer SMSF loans?
The structure is more complex, the security arrangements are limited by law, and the documentation requirements are heavier. Lenders that do operate in this space generally require larger deposits and apply stricter servicing tests than for ordinary property lending.
Do I need a financial adviser as well as a broker?
For most SMSF transactions, yes. Establishing an SMSF, deciding whether a purchase suits the fund’s investment strategy, and the tax treatment all sit outside credit assistance. We handle the finance and work alongside your accountant and adviser, or can introduce you to one.