Lenders who have pulled out of SMSF lending include: St George
, CBA, NAB (still in but require $5m in SMSF so, in reality, they’re not really in), BankWest, ANZ, RAMS and the list goes on.
SMSF loans are seen as a high reputational risk to some banks in the event that you were to default on your mortgage. These banks want to avoid negative publicity, particularly after a handful of case studies were used as examples in the recent Royal Commission into the banking and financial services industry. Basically, some borrowers were recommended the wrong products and didn’t seek adequate financial advice before purchasing a property for their SMSF.
Most people that have a self-managed superannuation fund (SMSF) are not necessarily high net worth individuals, which again relates back to potential negative personality.
However, the other reason some lenders have stopped SMSF loans has to do with the complexity of meeting the regulatory requirements - the return on investment is not worth the risk with some lenders because, again, they don’t tend to be large loans.