What Can You Use an SMSF Loan For?

An SMSF loan (Self-Managed Super Fund lending) allows your super fund to borrow money to purchase property—either residential or commercial—as an investment within your superannuation structure. This is a specialised lending strategy that must comply with strict superannuation and lending regulations.

SMSF loans can be used to purchase:

• Residential investment property: For rental income and long-term capital growth. The property cannot be used for you or related parties to live in.

• Commercial property: Including business premises. Many small business owners use their SMSF to purchase the premises their business operates from, provided it’s done on arm’s length commercial terms.

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Compliance Rules

How White Willow Finance Can Help

Before proceeding, it’s important to consult a qualified accountant so they can ensure the strategy:

• Aligns with your SMSF investment objectives

• Meets compliance obligations

• Supports your long-term retirement goals

Strict rules apply when purchasing property through an SMSF:

• Residential property: Cannot be occupied by you, your family, or related parties.

• Commercial property: Can be leased to a related business only at market rent and properly documented.

Non-compliance can result in serious penalties, so careful planning is essential.

At White Willows Finance, we guide you through the complexities of SMSF lending. We:

• Help structure loans to meet lender requirements

• Work alongside your accountant and advisers to ensure compliance

• Compare multiple lenders to find the best fit for your SMSF strategy

With our expertise, you can confidently access property investment opportunities through your SMSF while staying compliant and focused on long-term growth.

Key Considerations

SMSF loans usually have lower Loan-to-Value Ratios (LVRs) than standard home loans:

• Residential property: 70–80%

• Commercial property: 65–70% (varies by lender and asset)

This means your SMSF needs a larger deposit plus funds for stamp duty, legal fees, and liquidity requirements. Interest rates are typically higher, and lenders assess your ability to service the loan based on rental income and member contributions.