What Are Your Lending Options Inside Super?

LRBA is an acronym for Limited Recourse Borrowing Arrangement.

Super funds on their own can’t lend money from a bank or anything. They are not supposed to lend in their own right. In the right conditions, you can borrow using funds with your super and receive the income into your super fund if you have the right trust set up, the right loan agreements, and if they meet the requirements of the Superannuation Act.

For super contributions, the ones you make as an employee or as a business owner, whether they’re from the business or personal contributions, they can count towards your servicing of your borrowing capacity in your super fund.

If you are dropping $55,000 a year between you and your spouse, plus the rental income of your prospective property, it will do wonders for your borrowing capacity. But if you’re only chipping in $5 a year in contributions, you will be relying on rent and the lenders in space need to see a little bit of consistency.

You can’t just dump $50,000. You will need a bit of history if you need contributions to service, unless it’s a really high-yielding property, then you will probably need your super contributions, or a low loan.

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