SMSF lending allows trustees of a Self-Managed Super Fund to borrow money to invest in residential or commercial property.
SMSF lending allows a Self-Managed Super Fund to borrow for eligible property under a Limited Recourse Borrowing Arrangement, commonly known as an LRBA.
The rules changed on 10 August 2026. New real-property LRBAs are now restricted to property that meets the business real property requirements. Existing residential SMSF loans entered into before the changes can continue, and refinancing may still be available.
For SMSF Brokers Australia, our lending focus is now on commercial SMSF property finance and refinancing existing residential SMSF investment property loans.
Under an LRBA:
SMSF lending also needs to satisfy lender credit policy, which can differ considerably between lenders.
New SMSF property borrowing now centres on eligible business real property.
Depending on the transaction and lender, this can include property such as:
Some SMSFs may also be able to acquire business real property from a related party or lease eligible property to a related business, subject to applicable superannuation requirements.
Lenders will assess the property, fund, lease arrangements, servicing position and overall loan structure.
Existing residential SMSF loans entered into before 10 August 2026 may still be refinanced.
A residential SMSF refinance can involve moving the existing loan to another lender while the SMSF continues to hold the same residential investment property under the existing LRBA structure.
Lenders may assess:
Refinance options vary between lenders, so comparing specialist SMSF lenders can be an important part of the process.
The lender’s rights are generally limited to the asset connected with the LRBA rather than extending across the SMSF’s other assets.
SMSF loans are assessed differently from standard property loans and often involve specialist lender policies.
Loan repayments and property expenses generally need to be managed through the SMSF rather than through members’ personal accounts.
Lenders consider both the property and the financial position of the SMSF when assessing an application.
Depending on the lender and transaction, the assessment may include:
Lender servicing methods can differ significantly across the SMSF lending market.
SMSF lenders commonly require a stronger equity position than standard residential lenders.
For a new commercial SMSF property purchase, this may mean contributing a larger deposit plus acquisition costs from the fund.
For an existing residential SMSF refinance, lenders will look at the current property value and outstanding loan balance to determine the LVR.
Requirements vary by lender, property and fund position.
Lenders may also require the SMSF to retain a certain level of liquidity after settlement.
They may consider available cash alongside:
Liquidity requirements vary between lenders.
SMSF lending is highly policy-driven, and issues with the property or structure can delay an application.
Common areas to watch include:
The borrowing and ownership structure needs to meet lender requirements.
Specialised property types or locations may have fewer lender options.
The fund may need to retain a minimum level of cash after settlement.
Different SMSF lenders can assess the same fund differently.
For an existing residential SMSF loan, the incoming lender will need to review the existing LRBA and determine whether the proposed refinance meets its requirements.
We focus on the finance side of SMSF property transactions.
We can help with:
Where financial planning, taxation, accounting or legal matters need to be considered, trustees should speak with appropriately qualified professionals.
The SMSF property lending market now has a clear split.
New SMSF borrowing focuses on eligible commercial property, while existing residential SMSF borrowers may still be able to refinance their current loans.
We can review the lending position, compare suitable SMSF lenders and manage the finance process through to settlement.
This information is general in nature and relates to credit assistance only. It does not constitute financial, tax or legal advice. Speak with appropriately qualified professionals about your SMSF structure, investment strategy and tax position.
