A Self-Managed Super Fund (SMSF) is a superannuation fund designed for members (trustees) to have direct control over their retirement savings and investments. It is an investment portfolio that differs from a normal super fund as the trustees decide how the fund operates and how to invest.
The majority of lenders will not lend to super funds for investment properties because the lender has no recourse in the event that there is a default on the loan. Therefore, most lenders require a minimum deposit of 20-25% and some lenders also require personal guarantees from the members of the superannuation fund.
For new trusts, some lenders will look at the current income of the trust beneficiaries, the previous super contributions they have been making and their proposed new super contributions.
The SMSF loan can be assessed based on your proposed super contributions if they are within the maximum amounts allowed by the ATO and if you can afford these contributions without hardship.
If you are close to retirement age, then the lender may not accept your super contributions in their assessment. The lender may shorten the loan term or reduce the amount of the loan so that the rental income can cover the repayments.
What is debt consolidation
Paying off more than one debt at a time is not uncommon. But if you’re struggling to balance your debt repayments, debt consolidation may well be worth considering.
Debt consolidation is bringing all your existing debts together into one new debt, which can help you manage your repayments and give you a clearer picture of your financial future. You typically do this by taking out a new personal loan to repay your other existing debts, and then paying this new loan back over a set term.
It's important to know that applications for finance are subject to credit approval. Full terms and conditions would be included in any CommBank loan offer and fees and charges are payable