However, Naylor cautions that there are a range of steps that consumers and brokers need to follow to establish and structure the SMSF
and says the MFAA
is urging its members to develop a network of experts, including financial planners, accountants and legal firms, who can work together in their establishment and tax issues that flow from it.
“While many consumers are establishing their own SMSF, we believe mortgage brokers can project manage the process from day one because of their understanding and expertise with credit. With the success of SMSF borrowing relying heavily on credit approval from lenders, it makes sense for mortgage brokers to play a key role in project managing the SMSF lending to ensure all of the lender’s requirements are met from outset.”
Without lending approval, the transaction will usually fall over, he says, which highlights both the opportunity and the risks for brokers who are working in this space.
“We need to ensure that mortgage brokers fully understand all of the aspects around SMSF lending, so they can properly assist clients borrowing to fund their property investment.”