Creating and protecting your wealth
SMSF Loans
Case Study 1
In this situation Peter can set up a private instalment warrant arrangement. He would arrange his SMSF to borrow the additional $600,000 required on a non recourse basis and establish a security/debt instalment trust ('Bare Trust'), which would agree to purchase and hold the legal title of the property in trust for the SMSF. The borrowed monies combined with the existing funds in the SMSF would be transferred to the trustee of the bare trust to enable the acquisition of the property.

Upon acquisition, Peter's SMSF has a beneficial interest in the property and has a right to receive all the income derived from the property.

As the beneficial owner of the property, Peter's SMSF can instruct the Custodian to transfer the legal ownership of the property to his SMSF once the loan has been fully repaid.
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