Buying a property in the name of your Self Managed Super Fund (SMSF)
Buying a property in the name of your Self Managed Super Fund (SMSF) I find that Self Managed Super Funds (SMSFs) are getting very popular and more people are buying properties in the name of their SMSFs. However when buying a property in the name of the SMSF there are a few points to consider. You have to first decide whether you are going to fund the purchase with funds from your SMSF or whether you are intending to borrow to finance the purchase. The banks refer to this as limited recourse lending and they stipulate certain conditions that have to be met before they will agree to fund a purchase through a SMSF. It is advisable that you have a corporate trustee as the trustee of the Superfund. This ensures continuity. Often the husband and wife will decide to be the trustees of the SMSF and this is not advisable. If you don’t have a corporate trustee it can cost you more by way of fees and charges that are levied on the SMSF. Also in the event that one of the trustees passes away, it will leave you in a situation where there is only one trustee and additional costs have to be incurred to appoint another trustee and this procedure can be costly. However if you have a corporate trustee, this ensures continuity. When you make an offer on the property you must put the name of the trustees of the SMSF as the purchasers on the Contract of Sale and the deposit must be paid from the Superfund. If the trustees are not listed... read more
