New SMSF products offer loans up to $3 million at 70% LTV
Non-bank lender RedZed has expanded its range of lending products to include self-managed superannuation fund (SMSF) loans.
The introduction of ‘Super Resi SMSF’ and ‘Super Commercial SMSF’ loans allows small business owners to refinance existing SMSF loans or to acquire residential or commercial investment properties.
The ‘Super Resi SMSF’ offers loans up to $2 million with a 70% loan-to-value ratio, while ‘Super Commercial SMSF’ loans can go up to $3 million with similar LTV ratios.
The move, RedZed said, aims to accommodate the financial needs of Australia’s 2.3 million owners of small businesses by offering loans tailored to their distinct situations.
A lender known for supporting self-employed individuals, RedZed has provided over $8 billion in loans to more than 20,000 small business owners over the past 17 years. Its alternative documentation for income verification allows self-employed Australians greater opportunities to own commercial properties where they operate their businesses and to invest in residential or commercial properties.
According to RedZed, its entry into the SMSF loan market addresses the limitations faced by self-employed individuals due to traditional lending criteria, enabling them to make additional contributions to their SMSFs and refinance existing high-cost SMSF loans.
Despite SMSFs being utilised by a small fraction of Australians, they hold a significant portion of the country’s superannuation assets, accounting for 26% of the $3.3 trillion total, second only to industry funds.
“We are incredibly proud to launch our SMSF loans,” said Adrian Fisher (pictured), head of distribution and product at RedZed. “Self-employed business owners vary in the way they pay themselves and contribute to their superannuation funds, which lending institutions don’t always consider.
“We felt it was unfair that business owners who sporadically make contributions or wanted to make additional contributions to their fund to assist with purchasing property, were excluded because of restrictive lending criteria.
“RedZed truly understands the nuances of being self-employed, and we do everything we can to ensure this doesn’t negatively impact our customers’ borrowing power.”
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