Masterclass SMSF – Borrowing in Self-Managed Super Funds – Riskier and More Complex?

Borrowing in Self-Managed Super Funds – Riskier and More Complex?

Borrowing in Self-Managed Super Funds – Riskier and More Complex?

Mike Taylor of Money Management on 22 January writes:
“The Australian Prudential Regulation Authority (APRA) has signalled it regards lending to self-managed superannuation funds (SMSFs) by banks as potentially riskier than other forms of lending. The regulator pushed its way into the debate around lending within SMSFs last week, via its role as a banking regulator and by stipulating how lending institutions should treat loans to SMSFs. In a letter to all Australian incorporated Authorised Deposit-taking Institutions (ADIs), APRA’s executive general manager, policy, research and statistics Charles Littrell said the regulator was seeking to clarify the appropriate capital treatment of ADIs’ loans to SMSFs that are secured by residential mortgages.” MORE
However as Damon Taylor at SMSF Weekly reports, 22 January:
“In the wake of the Australian Prudential Regulation Authority’s (APRA’s) warning that loans to self-managed super funds (SMSFs) are more complex than those in a traditional retail environment, Craig Morgan, director of SMSF Loans, has voiced his disagreement. “While they are limited recourse, the rewrite of SIS 67A in July 2010 made it clear that Personal Guarantees were acceptable,” he said. “APRA’s concerns around enforceability are therefore viewed as extremely conservative.” With more than five years experience lending in the DIY space, Morgan said that the average loan-to-value ratio (LVR) for residential property loans was around 65 per cent, with commercial around 55 per cent.” MORE


About SuperBenefitnews

Self-Managed Superannuation Service Providers in Australia. SuperBenefit will SET UP your SMSF and provide investment education for a better result. We take care of all your administration, accounting, ATO lodgement and audit of SMSFs, working with you and your advisors. If you want advice we can arrange one of our recommended advisors and accountants to meet with you, as we do not give advice, but take instruction only. Take control of your super, including property shares and other assets. Learn how to be your own advisor - make better decisions - by being mentored and coached to invest your own super wisely and strategically by qualified partners. Book to come to an event to find out more, or - Call us 0407 361 596, no obligation FREE strategy call.
This entry was posted in SMSF Investing, SMSF Property, Super Law & Compliance and tagged , . Bookmark the permalink.

One Response to Masterclass SMSF – Borrowing in Self-Managed Super Funds – Riskier and More Complex?

  1. rileymackenzi says:

    A great article thanks for sharing this write-up over self managed super funds. I have gone through your internal link, as well and have gathered a huge information from there over these funds.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s