March 27, 2013
The Mortgage Choice Melbourne team at LaTrobe Street, are really embracing the growing fact SMSF loans are in demand. Enquiry is up for SMSF loans. People are keen to learn more about the subject. Melbourne Home Loans were always predominately made up of residential and commercial lending, however, self managed super fund loans are on the increase and here to stay.
It is a great avenue for people to invest in property. Stephen Zamykal, owner of the Mortgage Choice Melbourne franchise personally thinks buying an investment property Melbourne based, is the best way to use the funds in your SMSF. Borrowing within an SMSF is far from a straightforward exercise because each lender has different criteria.
Some require corporate trustees for the SMSF, others don’t. Lenders can charge significant fees for legal review and loan establishment fees. Interest rates can vary by as much as 2 per cent. Loan terms very from 10 to 30 years.
The documents required to set up an SMSF, however, tend to be similar and include:
- a superannuation trust deed
- a security deed between the super trustee and property trustee
- written confirmation from a financial planner that a statement of advice or a written advice from an accountant has been provided
- an application form, financials etc as per normal lending applications.
Lending serviceability will be assessed on a number of factors including:
- existing, proven recurring income to the SMSF
- future superannuation contributions based on past contributions to current or previous fund(s)
- proposed rental income
- LVRs range from 70 to 80 per cent depending on the lender.
After establishing the complete SMSF structure you will need to speak to your mortgage broker to help in organising your finance with the most appropriate bank/lender. You will need to establish your SMSF borrowing power. One requirement is to have enough funds as a deposit in your SMSF to buy the property at the price range you desire. The mortgage broker will go over all aspects of borrowing through an SMSF and will secure your loan pre approval before you buy.
For further information, call 03) 8602 6777, visit Ground Floor, 469 La Trobe St, Melbourne or log onto www.mortgagechoice.com.au/stephen.zamykal