Did they want personal guarantee or annual reviews? Did they only use superannuation contributions and rent as serviceability?
Our First Smsf Purchase - A Step By Step Guide
- Thread starter BV
- Start date
Did they want personal guarantee or annual reviews? Did they only use superannuation contributions and rent as serviceability?
No personal guarantee . Well not that I've been told .... We haven't need one in the past and he hasn't sprung any nasty surprises on us before . ( but anyway I could live with that )
details .. that's why I use a broker . I just asked him how much we can borrow and it was enough for what I wanted .
Cliff
Thats nothing - try fixing the mess thats caused when conveyancers place the superfund name on the COS.
Each lender has slightly different policies. St George is a bit more expensive than say Macquarie but if there are no additional contributions required for servicing then you do not need to service outside the SMSF and if you can include additional contributions even if you haven't contributed in the past.
Whereas say with Macquarie and AMP you need to have 2 years additional contribution history in order to use additional contributions. Macquarie also requires you to service inside and outside the SMSF. Macquarie certainly has the cheapest SMSF product but they do have one other major catch.
Whereas say with Macquarie and AMP you need to have 2 years additional contribution history in order to use additional contributions. Macquarie also requires you to service inside and outside the SMSF. Macquarie certainly has the cheapest SMSF product but they do have one other major catch.
Greedy, just looking to keep them for yourself. The question i was querying on was granny flats/ subdivide on large blocks. If your Super has 200 k and 100 k is used to service a LRBA and you are a builder by trade, how does it work if you improve by granny flat doing the work yourself in a pty ltd company, can you pay your company market rates for the work? If you didn't then the ATO would see it as a contribution. Or do you fail the arms length distance rule? 50 k left over in the fund is plenty to improve.
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Hi All
Read this whole post and it took me some time......however I am setting up my SMSF with a corporate trustee and now need to open a bank account. Should the account be opened in the name of the trustee or SMSF?
All this reading is doing my head in and I can't think clearly at the moment and need some direction!!!!!!!!
Please let me know.
Best
Barnie
Read this whole post and it took me some time......however I am setting up my SMSF with a corporate trustee and now need to open a bank account. Should the account be opened in the name of the trustee or SMSF?
All this reading is doing my head in and I can't think clearly at the moment and need some direction!!!!!!!!
Please let me know.
Best
Barnie
I would think trustee ATF SMSF?
OMG..huhh..spent few hrs reading this thread..sincere thanks to BV and all other members for their contribution..I am new to this game and lot of info is going over the head 
one question as I couldn't find the answer or may have missed it..
if I want to sell the property in SMSF before retirement, what happens to the money obtained (profit) from the sale? Can I withdraw this or it will have to be returned back to SMSF and I will have to wait until retirement to access it.
many many thanks all..
one question as I couldn't find the answer or may have missed it..
if I want to sell the property in SMSF before retirement, what happens to the money obtained (profit) from the sale? Can I withdraw this or it will have to be returned back to SMSF and I will have to wait until retirement to access it.
many many thanks all..
thanks Speary..makes sense..just have few more questions..
1. what if I don't want to buy the property through SMSF right now but few years later? Can I set up now and buy later?
2. Do I have to have investment strategy for SMSF funds? What if I want to set up SMSF now and dont want to do anything with it and just keep putting my contributions into it? I read somewhere in the thread that you can get 2-3% interest on funds which should cover SMSF running costs every year provided I have around 100k in super..?
3. My super contributions are around 900 a month and I have just looked at my super account and considering that I started working in 2004, it hasn't performed well at all..I would have more in super if I had not done anything with it and just parked it!
4. I am just thinking of consolidating mine and wife's super into SMSF and do nothing with it. When we have enough funds, we can buy property through super few years later. Am I thinking on track or it doesn't make any sense
sorry if it sounds very silly..newbie and just learning..
1. what if I don't want to buy the property through SMSF right now but few years later? Can I set up now and buy later?
2. Do I have to have investment strategy for SMSF funds? What if I want to set up SMSF now and dont want to do anything with it and just keep putting my contributions into it? I read somewhere in the thread that you can get 2-3% interest on funds which should cover SMSF running costs every year provided I have around 100k in super..?
3. My super contributions are around 900 a month and I have just looked at my super account and considering that I started working in 2004, it hasn't performed well at all..I would have more in super if I had not done anything with it and just parked it!
4. I am just thinking of consolidating mine and wife's super into SMSF and do nothing with it. When we have enough funds, we can buy property through super few years later. Am I thinking on track or it doesn't make any sense
sorry if it sounds very silly..newbie and just learning..
can anyone help me with my questions?
1: yes
2. when you setup your SMSF, the documents supplied will have an investment strategy. if not you can write a few words down on a piece of paper and file it.
3. It depends on what investment option you had chosen for your super.
I had all my super switched to fixed interest well before the GFC and before deciding to buy a property.
4. you can do this but if you left your super where it is now and simply switched your super to cash or fixed interest the management fees will be a lot lower than running a SMSF
I hope this helps
The thread started off 4 years ago with St George being a favorite for SMSF lending amongst few other member's feedback.
Is it still the case from a broker perspective? Is it still max 72% LVR with no personal guarantees?
Are there any other lender on LVR 80% that is as good as St George?
Is it still the case from a broker perspective? Is it still max 72% LVR with no personal guarantees?
Are there any other lender on LVR 80% that is as good as St George?
macq and amp have similar simple processes
80 %lvr with corp trustees is pretty standard, but all lenders that I know of want personal guarantees.
So technically, limited recourse against the SMSF assets, but open slather outside.
is it any wonder that the lenders like them : )
Rate for risk ........... ? possibly not
ta
rolf
Here is a very quick snapshot of some of the lenders that do SMSF:
Macquarie:
Pros - They do NRAS under SMSF, they have cheaper upfront, cheap ongoing, upfront vals and super cheap interest
Cons - no offset, they require you to have a 10% surplus in your super which is often a massive roadblock, servicing is conservative and if you need to use additional contributions - you need 2 years history evident and you need to service outside the SMSF (which you should be doing with all lenders anyway)
St George:
Pros - Offset, cheaper upfront and the ability to use additional contributions for servicing without the need to show 2 years history which is a big one.
Cons - Higher ongoing IR
AMP:
Pros - Offset, upfront vals and cheaper upfront
Cons - Poor turnarounds times, cannot use additional contributions without demonstrating 2 years history and expensive ongoing IR.
Resimac (and respective mortgage managers)
Pros - No ongoing fees, cheaper IR, NRAS, hands down the most generous servicing.
Cons - LVR payable for loans over 70% making the upfront expensive
IMO - an Offset in an SMSF is of huge importance. It is a strategy that is overlook by many.
Macquarie:
Pros - They do NRAS under SMSF, they have cheaper upfront, cheap ongoing, upfront vals and super cheap interest
Cons - no offset, they require you to have a 10% surplus in your super which is often a massive roadblock, servicing is conservative and if you need to use additional contributions - you need 2 years history evident and you need to service outside the SMSF (which you should be doing with all lenders anyway)
St George:
Pros - Offset, cheaper upfront and the ability to use additional contributions for servicing without the need to show 2 years history which is a big one.
Cons - Higher ongoing IR
AMP:
Pros - Offset, upfront vals and cheaper upfront
Cons - Poor turnarounds times, cannot use additional contributions without demonstrating 2 years history and expensive ongoing IR.
Resimac (and respective mortgage managers)
Pros - No ongoing fees, cheaper IR, NRAS, hands down the most generous servicing.
Cons - LVR payable for loans over 70% making the upfront expensive
IMO - an Offset in an SMSF is of huge importance. It is a strategy that is overlook by many.
Id go further
Id say its almost negligent of the trustees ( and by implication, the trustee's advisers) to not seek such a product where there is a long working life left.
An offset with an IO loan gets around the issue of not being able to regear debt once extinguished, but also provides for much improved risk management in case of a challenge, but also allows the SMSF to seize opportunities that may come its way.
ta
rolf
The dangerous assumption (not only by the investor but also the people sellling/recommending a product) is that we can just go on an IO loan and then once the value of the SMSF increases - we can simply draw upon the equity and reinvest.
The most ironic part of this story is that I went into 2 major St George branch last week to set up an offset for the SMSF loan and neither branch knew that they offered an offset against the SMSF.
The most ironic part of this story is that I went into 2 major St George branch last week to set up an offset for the SMSF loan and neither branch knew that they offered an offset against the SMSF.
Like in all areas of business, many purveyors of their product or service dont know of important benefits or chinks of those same products - banking and finance isnt any different I guess.
Whats really amusing is that this is a major product benefit compared to the other majors, and youd think good sales people would be all over it
ta
rolf
Point 1 (if i have done my research correctly) is possible if you avoid the LRBA test by funding the whole lot without a loan. What if you are over 65 and conduct developments in your SMSF? Say buy house, knock down, build 4 and sell? Other than GST no tax?
