Self-Managed Super Funds (SMSFs) have gained a reputation for their complexity, primarily due to stringent rules surrounding tax, legalities, and financial planning.
Brokers must navigate SMSFs using a meticulous and informed approach, but with non-banks venturing into the area, doing so has become much easier compared to when mainstream banks held predominant sway a few years ago.
Industry experts Firstmac, La Trobe Financial, and Thinktank said non-bank lenders are committed to facilitating smoother interactions for brokers.
“Many non-bank lenders aim to make it easier for brokers to do business with them,” said Peter Vala (pictured above left), general manager for partnerships and distribution at Thinktank.
The adoption of a centralised credit process has played a pivotal role in streamlining assessments of complex lending structures, ensuring a consistent approach to credit decisions, Vala said.
At La Trobe Financial, for instance, there are no additional accreditation requirements for brokers already affiliated with major aggregators seeking to offer SMSFs.
“While some additional supporting documentation requirements exist, our application form and submission process remain unchanged for SMSF lending,” said Cory Bannister (pictured above centre), senior vice president and chief lending officer.
SMSFs, once considered niche, have evolved into something more mainstream as more potential borrowers actively explore their options, and non-banks intensify their education in the area.
Non-banks, such as Firstmac, are contributing to this shift by simplifying the application process.
“Our application process is simple, with a clear policy and minimal supporting documents required,” said James Austin (pictured above right), chief financial officer at Firstmac. “We handle all the legal components internally, ensuring end-to-end control and providing [brokers] with an easy-to-follow checklist – it truly is SMSF made simple.”
A plethora of educational opportunities on SMSFs has also become available, with most non-bank lenders offering support and training for brokers, from initial workshops to the final settlement.
“Don’t be discouraged by the perceived complexity of SMSFs,” Austin said. “Once the correct structure is in place and you’ve received the necessary training from the lender, SMSFs can be relatively straightforward. Once you’re well versed in this market segment, it can even become easier than a standard residential transaction.”
The first step is often to simply get in touch with a BDM at a non-bank.
Bannister noted a direct correlation between an increase in BDMs and broker meetings and the subsequent likelihood of loan approvals.
“With SMSF lending perhaps misunderstood by some brokers, speaking with our sales team, who are all experts in SMSF lending, is a sure-fire way to increase volumes in this segment,” he said.
Read the premium story, SMSFs offer shelter from the storm, and More non-banks venturing into SMSF to learn more about how non-banks are making SMSFs easier than ever, and the secret as to why more lenders are entering this area.
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