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Trust lending tightens: Investors turn to SMSF for portfolio growth
In this episode of The Smart Property Investment Show, host Phil Tarrant is joined by Costa Arvanitopoulos from Finni Mortgages to unpack Macquarie Bank’s retreat from trust and company lending and the rising role of self-managed super funds (SMSFs) in property investment.
They explain that Macquarie’s move, driven by tighter anti-money laundering (AML) scrutiny and concerns over spruikers using trusts to dodge serviceability rules, signals a broader shift in how lenders view complex structures.
While this may disrupt investors who use trusts for tax and asset protection, borrowing in personal names remains available, and other lenders are expected to fill the gap.
Against this backdrop, Tarrant and Arvanitopoulos highlight SMSFs as a more mainstream and increasingly popular vehicle for property investment.
Arvanitopoulos notes that SMSFs let investors use their super to buy property without impacting personal borrowing capacity, which is particularly useful for those already maxed out in their own names.
He explains that SMSF lending focuses on fund contributions, rental income and, for business owners, company financials to prove serviceability.
The duo also flag the limitations and tax settings around SMSFs, including no equity release, no major renovations, and higher tax rates on very large balances.
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