ISLAMIC SMSF FINANCE
A ready-made solution
to help you tap into your SMSF & invest in property
Looking to put your self-managed super fund (SMSF) to work? Our flexible approach to SMSF lending could help purchase a residential or commercial investment property.
Buying a Home
Refinancing
Self Employed
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SUPER WORKING WITH SMSF
Islamic SMSF Product
Whether you have an existing SMSF or are in the process of setting one up, our Islamic SMSF product is suitable for those looking to purchase or refinance residential investment properties as a single asset within their SMSF.
You can now use your SMSF to purchase an investment property. Providing SMSF finance for the specific needs of the Muslim community, it sets a new benchmark in inclusivity and innovation. Transform your super fund experience to one that is more equitable and efficient, while ensuring your investments are both secure and profitable.
Retirement
Grow your retirement investment potential with our Halal SMSF Finance
Residential SMSF Finance
Our Halal residential SMSF finance can help you invest in property if you don’t have the funds in your SMSF to buy a property outright.
Commercial SMSF Finance
Designed to work in harmony with your SMSF and help you invest in commercial property
Al-Mustaqbal SMSF Finance at a glance
Loan Purpose |
New Purchase, Refinance and Equity Cash Out |
|---|---|
| Security Type | Residential security |
| Security Location | Metro & non-metro considered |
| Minimum Finance Amount | $250,000 |
| Maximum Finance amount | $2,000,000 |
| LVR up to | 80% |
| Rental Rate type | Variable or Fixed |
| Repayment Type | Rent+ Principal or Rent Only |
| Offset account and Redraw facility | Yes |
| Loan Term up to | 30 years |
| Fixed Rate Options | Yes, up to 5 years POA |
| Risk fee | Yes |
| Additional Repayments | Unlimited |
One of Australis Leading Islamic Financial Service Providers
Ready to apply?
Whether you’re ready to apply or you’d like to know more, one of our business specialists will be happy to help and provide more information.
What you’ll need
To apply for a SMSF loan, you will need to provide the following specific documentation:
- Certified copy of the SMSF Trust Deed
- Certified copy of Custodian Trust Deed
- Financial information to ensure serviceability (e.g. 2 years SMSF audited financial statements, 12 months SMSF bank statements, rental estimates)
- Full copy of contract of sale
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Frequently asked questions
Your SMSF works in much the same way as any other super fund. During your working life, contributions are made to the fund and invested to create wealth which is distributed during retirement.
Yes, you will require a certain level of liquidity after the transaction, and some have a minimum pre-purchase balance.
We recommend a balance of cash and shares of at least $150,000 be available, anything less usually does not allow a reasonable purchase & liquidity for the fund.
Yes! When a new SMSF is set up by your accountant or financial planner, you can apply for a SMSF loan by showing historical contributions to your old fund(s).
Investing in residential or commercial properties through a Self-Managed Super Fund (SMSF) is possible, subject to certain conditions:
- The property must be purchased as an investment and rented out to a third party at arm’s length.
- Is not a development – i.e. something that requires construction or is vacant land is not acceptable.
- The property meets the ‘sole purpose test’ provided by the ATO (i.e., only providing a benefit to the members upon retirement).
- The property should not be sold by a fund member or lived in by them or any related person. However, commercial properties purchased by the fund can be leased to a fund member for business purposes, following specific rules and at the market rate.
- Only one title per contract is allowed when purchasing a property through an SMSF. For instance, a duplex across two titles sold in one transaction would have to be changed to two separate transactions and loans.
If you are interested in expanding your SMSF investment portfolio, our qualified home finance specialist can help. You can schedule an appointment with us by calling 1300 141 145 or booking an appointment below.
Using a self-managed super fund (SMSF) to buy a property requires a different home loan structure and process. All SMSF home loans are taken out using a limited recourse borrowing arrangement (LRBA), involving a separate property trust and trustee outside of the SMSF structure. The lender only has the property held in the separate trust as security, so the SMSF must meet all loan repayments. Lenders will use the expected rent, investment income, and historical superannuation payments to determine affordability.
All the income and expenses of the property go through the SMSF’s bank account, and the fund must meet all loan repayments as they are due. If the SMSF fails to do this due to insufficient funds, the lender only has the property held in the separate (bare) trust as security, and therefore cannot access any remaining assets of the super fund. Because of this, lenders will expect the fund to have a certain level of cash after the purchase as a buffer, and will generally use the expected rent + other investment income (e.g., interest on the amount of remaining cash) + historical superannuation payments made for their affordability calculations. If there is a shortfall to be made up with voluntary contributions from a member, this will often need to be evidenced by historical voluntary contributions over the past year (or 2 years for self-employed members).
Unlike regular investment loans, your personal income, assets, liabilities, living expenses and age are not necessarily taken into consideration but are required to show your profile as a guarantor on the loan. However, your credit history is considered, and while previous adverse credit will not mean an automatic decline, it may increase the interest rate and/or lower the LVR available to the SMSF.
