Super gearing-tenancy in common with smsf

[Ajax]

A summary of how to do this is here-

http://www.diysuperfund.com.au/SuperGearing.htm

Any comments? I.e. Will a lender lend using the 50% interest as tenant in common as security? What about lo-doc or no-doc lending on this type of security? By doing this are you killing off your potential to grow a portfio of properties?


Ajax

 

[Garry K]

Thanks Ajax, interesting site.

Will a lender lend using the 50% interest as tenant in common as security?

I think not as the assets of a super fund cannot have a charge over them.

By doing this are you killing off your potential to grow a portfio of properties?

Like most strategies, there are limitations. One of the dangers with just one property as the funds asset, is what do you do if one of the suggested 4 members decides they want out of the SMSF? You can't rollover a part of a house. Or at retirement, one wants to cash out some funds.

And how do the individuals repay the debt?

GarryK

 

[Ajax]

Hello Garry,

it seems I misunderstood the diagram. The borrowings are by the individuals and are secured over their own home. There are no borrowings secured over the property to be acquired.

I also note that a tenancy in common can be in whatever ratio you desire i.e SMSF 75% Husband and wife 12.5% each or SMSF 25% X pty ltd as trustee for the Y family trust 75%


Ajax