AMP back lending for SMSF

AMP withdrew from the SMSF market recently. They are however back lending. While every client has different requirements there are some standout features with this product which we look at below.

Loans to SMSFs - AMP SuperEdge Loans

The following changes are applicable to loans to SMSFs and the Credit Policy for AMP SuperEdge Loans has been updated accordingly:

  • Maximum LVR for any security is 70%.
  • Properties less than six months old (including off the plan) are now classified as unacceptable securities (for SMSF loans only).
  • Minimum fund size of $200,000 (based on net assets) at time of assessment of the loan.
  • The SMSF must pass a liquidity test. The SMSF must hold liquid assets (cash, shares, government bonds, term deposits) of at least 10% of total assets, after settlement.


This means that the SMSF must hold a minimum of 10% of total fund assets as liquid assets. Liquid assets comprise cash or term deposits, shares and government bonds. The liquidity test will be assessed by us based on a calculation of surplus in 'funds to complete'.

Funds to complete example (based on a NSW purchase):

Purchase price

$300,000

Fund holdings

$250,000

Bank fees

$ 2,125

Deposit paid

not paid yet

Legal fees

$ 6,000

Loan amount

$210,000

LMI

N/A

Stamp duty

$ 8,990

Other

Total

$317,115

$460,000

Surplus / Deficit

$142,885 (+)

In the above scenario the SMSFs total assets after settlement will be $442,885 (property $300,000 and surplus holdings $142,885).

To pass the 10% liquidity test, the SMSF must hold at least $44,288 in liquid assets.