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Non-bank lender RedZed has launched two new SMSF products that aim to target self-employed buyers hoping to invest.
RedZed has today (15 February) launched two new self-managed super fund (SMSF) products, “Super Resi SMSF” and “Super Commercial SMSF”, which offer alternative documentation (alt doc) income verification options to assist self-employed borrowers with SMSF property investments.
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These new SMSF loans can be used to refinance existing SMSF loans or purchase residential or commercial investment properties, according to the non-bank.
The Super Resi SMSF offering has a maximum loan size of $2 million at a 70 per cent loan value ratio (LVR), $1.75 million at a 75 per cent LVR, or $1.5 million loan on an 80 per cent LVR. Rates start from 7.19 per cent, or 7.54 per cent for alt doc.
The Super Commercial SMSF loan has a maximum loan size of $3 million for 70 per cent LVR loans, or $2.5 million for 75 per cent. Rates start from 7.95 per cent (or 8.3 per cent for alt doc).
The loan terms available are 15 to 30 years, with interest-only terms available up to five years.
Normal securities apply excluding vacant land, development sites, and serviced apartments.*
RedZed has stated that it created these products to cater to self-employed business owners who might make irregular or additional contributions to their superannuation funds and require more flexible SMSF investment products.
The new products will open the door for borrowers who are often denied the opportunity to purchase property due to “restrictive lending policies”, according to RedZed.
Adrian Fisher, RedZed’s head of distribution and product, stated that the new SMSF offerings would allow brokers the flexibility to offer solutions to self-employed clients.
“Most SMSF lending products service PAYG members who have compulsory superannuation guarantee contributions paid into their funds by employers, or self-employed Australians who regularly contribute to their super funds. But what about self-employed business owners who sporadically make contributions? Or those who want or need to make additional contributions to their fund in order to purchase property? These individuals are often closed out of the opportunity due to restrictive lending policies,” he said.
“Our flexible SMSF products consider those who work for themselves and often can’t meet those traditional lending criteria.
“In continuing to demonstrate our understanding of the nuances of being self-employed and the challenges it can pose to borrowing power, we maintain a holistic view of business and income, and take a flexible approach to qualification assessments, thus providing self-employed Australians with the same growth opportunities as everybody else.”
He added that the new range would “give broker businesses a boost”.
“After successfully piloting Super Resi and Super Commercial with brokers from one of our key white label partners over the last few months, we are delighted to now introduce our ‘super-powered dynamic duo’ to the broader broking industry,” Mr Fisher said.
Calvin Cordle, the managing director at RedZed, echoed Mr Fisher’s sentiments, stating that the SMSF loan launch was a further example of RedZed’s focus on delivering “more solutions, more often” for self-employed borrowers.
RedZed has joined a growing trend of non-bank lenders offering SMSF loans to borrowers, following offerings from Pepper Money and Uptain in 2023.
Brokers have supported the growing flexibility of non-bank lenders offering products that appeal to a diverse range of clientele.
*This story was updated on 15 February to reflect a list of excluded securities
[Related: Pepper Money unveils SMSF loan offering]
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