Home Finance & Economy Australia’s Big Banks To Ban SMSF Home Loan

Australia’s Big Banks To Ban SMSF Home Loan


Australians looking to use a self-managed super fund (SMSF) to purchase property should make a move now as some of Australia’s big banks will soon bring this option to a close.

Westpac, Commonwealth Bank and AMP are set to ban SMSF lending for property purchase, in an attempt to mitigate the risk the banks are exposed to.

The specifics of these bans are not uniform. According to Sally Tindall, RateCity research director, the AMP still supports the existing SMSF home loan customers. However, when November comes, these customers will not be permitted to extend their loan term, switch to interest-only, or internally refinance.

Meanwhile, the CBA announced the ban will be effective starting October 12, 2018, while the Westpac have already banned new customers of SMSF home loans as of late July. However, both CBA and Westpac will continue supporting the existing SMSF loan customers.

“Banks are focused on reducing risk in their loan books,” Tindall said. “In a falling property market, it’s not surprising we’re seeing lenders retreat from this type of lending.”

- Advertisement - Not Real Estate News Group Content

Meanwhile, Mrs Tindall added, some lenders are likely to defy this move. According to RateCity data provided to news.com.au, the following banks will continue to offer SMSF property loans at least for the duration of October – with loan to value ratios from 70 to 80% and advertised rates between 5 and 6.5%, some banks withholding these figures pending assessment.

Bank Australia

Bank of Queensland

Bendigo Bank

Big Sky Building Society

Heritage Bank

Hume Bank

IMB Bank

La Trobe Financial


Liberty Financial

LJ Hooker Home Loans

Macquarie Bank

Mortgage House

Red Rock Mortgages

Regional Australia Bank



Switzer Home Loans

Yellow Brick Road