The Broker Times · SMSF Lending Snapshot
The SMSF File After 10 August: What You Can Still Write, and What the Real Gate Is
A new near-prime tier reopens the grandfathered refinance. A new purchase turns on a superannuation test, not a property label.
The numbers that set the boundary
The gate on a new arrangement
The ATO states the change “changes the meaning of an acquirable asset to exclude the purchase of real property” that “does not meet the definition of ‘business real property’”. The question is use, not the words on the contract.
What the ATO says is unaffected
Still open
- Limited recourse borrowing arrangements entered into before 10 August 2026
- Refinancing of arrangements entered into before that date
- Binding contracts to acquire real property exchanged before that date, even where settlement or the arrangement follows it
Where the new test bites
- A new arrangement to acquire real property that is not business real property
- A “commercial” asset that is not used wholly and exclusively in one or more businesses
- Holdings such as lifestyle blocks and hobby farms, per professional commentary
Reported loan-size caps disagree — check the guide, not the headline
The takeaway
The residential SMSF work left in the channel is largely refinance work on a grandfathered book, and a near-prime tier is what makes the impaired slice of that book placeable. A new purchase is a different conversation, and the person who answers the business real property question is the client’s SMSF adviser.
Sources: ATO guidance on the limited recourse borrowing arrangement provisions and the SMSF newsroom item on changes from 10 August; MA Money broker loan solutions page; Australian Broker and Broker Daily reports of the 2 November 2026 launch; Grant Thornton and Boyce client commentary. Figures are as published at 4 November 2026 and should be confirmed against the current product guide.
Loan Tips · SMSF Lending
MA Money Will Take One Month of Arrears on an SMSF Refinance at 80% LVR. The Gate on a New Purchase Is “Business Real Property”, Not “Commercial”
Not quite three months after the limited recourse borrowing rules changed, the residential SMSF work left in the channel is mostly refinance work on a grandfathered book. A near-prime tier makes the impaired slice of it placeable — and the purchase conversation is now a superannuation question, not a property-type one.
In this article
- What MA Money actually did on 2 November
- What the ATO says changed on 10 August
- “Commercial” was never the test
- What SMSF work is left for brokers
- Why a near-prime tier matters to a grandfathered book
- Don’t quote a cap from a news story
- Which of your obligations attach is a licensee question
- What to review this week
- What to watch next
On 2 November, MA Money added a near-prime tier to its SMSF lending range. Taken alone, that is a product note. Taken together with what the law actually says, it is a fairly precise map of where SMSF work still sits in the broker channel — and a reminder that the shorthand the channel has settled on for the 10 August change is wrong in a way that will cost someone a deal.
What MA Money actually did on 2 November
MA Money’s broker site carries a news item dated 2 November 2026 announcing an expansion of its SMSF lending range with new near-prime options. Its loan solutions page now lists three SMSF tiers — SMSF, SMSF Prime and SMSF Near Prime — each shown at a maximum 80 per cent LVR, with the SMSF range given as $100,000 to $8 million.
The near-prime criteria on that page are the part worth reading twice. SMSF Near Prime accepts mortgage arrears of up to one month within the last six months, a discharge from bankruptcy of more than one day, and credit impairments subject to the product guide. MA Money’s own definition of arrears is unusually explicit: any late payment or arrears on a credit account — credit cards, personal loans and mortgages — where the minimum repayment is not made within 14 days of the due date.
The same page tells you something about the shape of the market. Its SMSF Residential entry covers refinances, and purchases “with a contract dated prior to 10 August 2026”. Its SMSF Commercial entry covers new purchases and refinances. The lender has encoded the statutory transition directly into its product matrix, which is a useful signal: the contract date is now a field on the file, not a footnote.
Broker Daily, reporting the launch on 3 November, added detail not shown on the public product page: credit impairments unlimited where paid or unpaid up to $3,000, and impairments above $3,000 accepted where paid in the last 12 months and listed; servicing assessed entirely within the fund with no external servicing; no interest cover ratio requirement on the commercial product; and indicative pricing from 8.29 per cent for residential and 8.79 per cent for commercial at 65 per cent LVR or less, with legal, discharge, facility risk and periodic fees on top. Those figures appeared in that outlet’s report and should be confirmed against the current guide before you quote them.
Australian Broker, reporting on 2 November, noted alongside the launch that MA Money was promoting prime SMSF residential refinance pricing from 7.34 per cent per annum, with a comparison rate of 7.37 per cent per annum on a $150,000 loan over 25 years, for LVRs up to 70 per cent, plus conditional approval in as little as 48 hours. National sales manager Tim Lemon was quoted in that report saying the move was “about helping brokers find solutions for clients who may have previously had limited options”. Head of lending Stephen Begnell was reported as framing the expansion around the range of SMSF scenarios brokers are now managing.
What the ATO says changed on 10 August
Here is where most of the commentary goes soft, so it is worth using the regulator’s own words.
The ATO’s new-legislation page on the limited recourse borrowing arrangement provisions states that the Treasury Laws Amendment (Tax Reform No. 1) Act 2026, following a parliamentary amendment agreed to on 25 June 2026, “changes the meaning of an acquirable asset to exclude the purchase of real property” that “does not meet the definition of ‘business real property’”. It states that “the change applies to arrangements entered into on, or after 10 August 2026”, and that it “does not impact arrangements existing prior to this date” or “the refinancing of arrangements existing prior to this date”.
The ATO’s SMSF newsroom item, dated 29 July 2026, puts Royal Assent for the Act at 26 June and sets out the same position with one addition that matters on a live file: “binding contracts to acquire real property exchanged before 10 August 2026” are unaffected, “even if the contract settles or the LRBA is entered into after this date”.
So there are three categories the regulator says the change leaves alone: arrangements entered into before 10 August 2026, refinancing of those arrangements, and binding contracts exchanged before that date. Everything else entered into from 10 August has to get through the business real property test.
“Commercial” was never the test
The channel has compressed all of this into “residential SMSF borrowing is banned, commercial is fine”. That shorthand will hold up most of the time and fail badly some of the time, and the failures will be expensive because they surface after a client has signed something.
Grant Thornton’s client alert on the change makes the point directly: limited recourse borrowing arrangements are not banned, the test is business real property, and commercial property is not expressly exempted. Its summary describes business real property as generally meaning land and buildings used wholly and exclusively in one or more businesses, and notes that this is a superannuation test rather than something determined by zoning, property description, loan type, or whether a building looks commercial. It also notes that the identity of the lender — bank, non-bank or related party — does not change the rules.
Boyce made the same argument in a 3 July 2026 client piece by Julie Schofield, its executive business unit leader for private business services and superannuation. That piece sets out the two symmetrical misconceptions: commercial property is not always eligible, because it can fail where it is only partly used in a business; and residential property is not always barred, because a dwelling used entirely as a professional practice, or land held as trading stock by a developer, can satisfy the test. It identifies lifestyle blocks, hobby farms and land not used in a genuine business as the holdings most likely to fall outside the definition, and flags as unresolved whether a fund can borrow to acquire new or off-the-plan commercial property that is not in business use at the time of acquisition.
That last point deserves to be said plainly, because it is also where a broker’s exposure sits. Whether a particular property satisfies the business real property test is a superannuation and tax question that belongs to the client’s SMSF adviser, accountant or lawyer. ASIC’s guidance on the best interests duty is comfortable with that division of labour where it applies: RG 273.141 states that “we do not expect you to give detailed advice on tax or other matters outside your expertise”, and RG 273.143(b) contemplates telling a consumer that “they should seek advice from someone with appropriate expertise and competence”. The commercial risk is not in referring the question out. It is in answering it yourself over the phone because the lender’s matrix said “SMSF Commercial”.
What SMSF work is left for brokers
Read the ATO’s three carve-outs against a lender’s product matrix and the opportunity set is clear enough to write on a whiteboard.
| Scenario | Position from 10 August 2026 | Where the work is |
|---|---|---|
| Existing SMSF residential loan, arrangement entered before 10 Aug 2026 | Grandfathered; refinancing of a pre-10 August arrangement is not impacted, per the ATO | Pricing reviews and refinances — the bulk of residential SMSF work now |
| New SMSF purchase of residential property | Must meet the business real property test, which ordinary residential investment property will not | Effectively closed, barring the narrow cases advisers identify |
| Binding contract exchanged before 10 Aug 2026, still settling | Unaffected even where settlement or the arrangement follows that date, per the ATO | A shrinking tail — evidence the contract date |
| New SMSF purchase of business real property | Available where the property meets the test | Open, subject to the adviser’s answer and lender policy |
| Existing SMSF commercial loan | Grandfathered on the same basis as any pre-10 August arrangement | Refinance and restructure work |
What that table says about your week is that the growth line in residential SMSF lending is no longer acquisition. It is your own back book, plus everybody else’s.
Why a near-prime tier matters to a grandfathered book
A grandfathered cohort is a closed population. It stops growing, and it ages. Loans written in a different rate environment sit on pricing set years ago; trustees who were comfortable at settlement have since been through two years in which assessment rates and repayments moved; and some of those funds now have a blemish on a credit file that a prime SMSF matrix will not look at.
Until a lender puts a near-prime tier over that population, a trustee with one month of arrears or a paid default has nowhere to go. The loan cannot be refinanced on prime terms, and — because the arrangement is grandfathered — letting it go is not a neutral act. It is the one slice of SMSF residential lending where a borrower is genuinely captive to the pricing of the lender they are already with.
The second structural feature worth understanding is how these loans are assessed. Broker Daily reported that MA Money services the near-prime SMSF loans entirely within the fund, with no external servicing. If that holds on the current guide, it changes the diagnostic question on the file. The fund’s rent and contributions carry the debt, which means an arrears event in an SMSF loan is frequently a fund-level cash flow problem — a vacancy, a contribution timed badly, a liquidity buffer run thin — rather than a statement about the member’s personal finances. That is worth establishing with the client and the adviser before you characterise it either way on a submission, because the two explanations lead to different files and different credit outcomes.
Don’t quote a cap from a news story
This launch is a small case study in why a product note is not a product guide. On loan size, the two trade reports do not agree with each other, and neither matches the band on the lender’s own page.
- MA Money’s broker loan solutions page gives the SMSF range as $100,000 to $8 million, with a maximum 80 per cent LVR across its SMSF tiers.
- Australian Broker reported the near-prime tier at up to $5 million for residential refinance and up to $8 million for commercial.
- Broker Daily reported it at $100,000 to $3 million for residential and up to $4 million for commercial.
Those are reconcilable — a published band can sit across several products while sub-limits apply per tier — but you cannot reconcile them from the outside, and a trustee who has been told $5 million will not be charmed to learn it was $3 million. On this one, treat the lender’s current product guide and your BDM as the source and the headline as a prompt. Where this article gives a figure that appeared in a single outlet, it says so for the same reason.
Which of your obligations attach is a licensee question
Brokers tend to carry one process across every file, which is usually good discipline and occasionally a category error. SMSF lending is written through structures that do not always sit inside the consumer credit regime, and whether a given SMSF file attracts obligations under the National Consumer Credit Protection Act 2009 — the best interests duty among them — depends on how the arrangement is structured. That is a question for your licensee and your aggregator’s compliance team, and it is worth asking in the abstract now rather than on a live file later. Many licensees apply a best-interests-equivalent process to SMSF files by policy regardless of the legal answer.
Where the duty does attach, two paragraphs of ASIC’s guidance bear directly on a refinance-led conversation. RG 273.120 states that “for consumers who may be thinking about refinancing, you should consider the costs associated with refinancing” — and on a near-prime SMSF product with legal, discharge, facility risk and periodic fees, those costs are not trivial. RG 273.91 states that “you must base all recommendations you make on the consumer’s individual circumstances”, which in an SMSF context means the fund’s circumstances, not a product comparison. RG 273.119 goes to the reverse case: suggesting a consumer remain in a credit contract is itself something you must not do without consideration. A decision to leave a grandfathered loan where it is, because moving it would cost more than it saves, is a recommendation and belongs on the file as one.
On evidence, ASIC is unambiguous in RG 273.162: “as a mortgage broker, we expect you to keep records of how you have acted when providing credit assistance”, and in RG 273.160, “you should keep records of your reasoning behind any recommendation you make”. For SMSF files the practical addition is to record the two things you did not decide: the contract or arrangement date you relied on, and the fact that the business real property question was referred to the client’s adviser, with their answer.
Key takeaways
- The ATO states the change applies to arrangements entered into on or after 10 August 2026, and that it does not affect existing arrangements, refinancing of existing arrangements, or binding contracts exchanged before that date.
- The statutory gate on a new arrangement is whether the real property meets the definition of business real property. “Commercial” is not the test, and professional commentary is consistent that a commercial asset only partly used in a business can fail it.
- Whether a specific property passes that test is a superannuation question for the client’s SMSF adviser. Refer it out and record the answer.
- MA Money’s SMSF Near Prime tier is shown at a maximum 80 per cent LVR, accepting up to one month of mortgage arrears in the last six months and a bankruptcy discharged more than one day. Its residential use case is refinance; purchases require a contract dated before 10 August 2026.
- Reported loan-size caps differ between outlets and from the band on the lender’s own page. Confirm against the current product guide before quoting a client.
What to review this week
A five-step pass over your SMSF exposure
- Pull the list. Every SMSF loan in your book or your CRM, residential and commercial, with settlement date, current rate, balance and LVR. If your CRM cannot filter SMSF loans as a product type, that is the first thing to fix — this cohort is now a segment you will work repeatedly.
- Establish the arrangement date, not the settlement date. The ATO carve-outs turn on when the arrangement was entered into, and on binding contracts exchanged before 10 August 2026. For anything near the line, get the document rather than the client’s recollection.
- Flag anything that has been varied. Grant Thornton’s alert recommends advice before refinancing or materially varying an arrangement, specifically where the refinance involves different loan terms, a related-party lender or additional borrowed amounts. Those three flags belong in your notes before you approach a lender.
- Sort the book by who is stuck. Separate the funds that could refinance on prime terms today from the funds with arrears, a paid default or a discharge in their history. The second group is the one a near-prime tier exists for, and the one most likely to be sitting on uncompetitive pricing with no alternative.
- Pre-brief the adviser relationship, not the client. For any purchase enquiry, your first call is the accountant or SMSF adviser on the business real property question. Build that referral path now, while the enquiry is hypothetical, rather than when a trustee has a contract in front of them.
What to watch next
Three things will shape this segment over the next two quarters. The first is whether other lenders follow MA Money into near-prime SMSF, because a single lender with a captive cohort sets the price. MPA reported that ORDE Financial lends up to 80 per cent of security value on eligible commercial and SMSF commercial property, so the commercial end of the panel already has depth; the impaired residential refinance end does not.
The second is the off-the-plan and not-yet-tenanted commercial question that Boyce flagged as unresolved. If guidance or practice settles that an asset must be in business use at acquisition, a slice of what the channel is currently treating as open SMSF commercial business closes.
The third is whether the grandfathered population behaves like a stable annuity or a run-off. Every refinance keeps an arrangement alive; every payout that is not refinanced removes a file from the segment permanently. That makes retention on an SMSF loan worth more than retention on a comparable residential investment loan, because the asset cannot be replaced with a new purchase.
The bottom line
Just under three months in, SMSF lending has split into two quite different broker propositions. One is a refinance and retention business over a closed, ageing, partly impaired book, where pricing reviews are the work and a near-prime tier is what makes the hard quarter of it placeable. The other is a purchase business gated by a superannuation test that has nothing to do with the residential-versus-commercial distinction brokers use to sort everything else.
Getting the first one right is a database exercise you can start this week. Getting the second one right mostly means knowing which question is not yours, asking someone whose question it is, and writing down what they said.
Frequently asked
The ATO states that the change “does not impact the refinancing of arrangements existing prior to” 10 August 2026. Grant Thornton’s alert recommends obtaining advice before refinancing or materially varying an arrangement, particularly where different loan terms, a related-party lender or additional borrowed amounts are involved. The position on any individual fund is a question for the trustee’s adviser.
No. The ATO describes the change as excluding from the meaning of an acquirable asset the purchase of real property that does not meet the definition of business real property. Grant Thornton notes commercial property is not expressly exempted, and Boyce notes commercial property can fail the test where it is only partly used in a business. Whether a specific property qualifies is a superannuation question for the client’s adviser.
The ATO’s SMSF newsroom item states that binding contracts to acquire real property exchanged before 10 August 2026 are unaffected, “even if the contract settles or the LRBA is entered into after this date”. Boyce’s commentary adds that to rely on the transition, contracts must be in place and all relevant entities, including the holding trust, correctly established before commencement. Evidence the dates on the file.
MA Money’s loan solutions page shows SMSF Near Prime accepting mortgage arrears of up to one month within the last six months and a bankruptcy discharged more than one day, with credit impairments subject to the product guide. Broker Daily reported impairments unlimited where paid or unpaid up to $3,000, and above $3,000 where paid in the last 12 months and listed. Confirm the current criteria with the lender before relying on them.
Whether a given SMSF file attracts obligations under the National Consumer Credit Protection Act 2009, including the best interests duty, depends on how the arrangement is structured, and is a question for your licensee and compliance team rather than one to assume either way. Many licensees apply an equivalent process to SMSF files by policy regardless.
Lender policy moves faster than your pipeline
The Broker Times tracks the policy, regulatory and market changes that land on Australian broker files.
More at The Broker Times →Sources: Australian Taxation Office, “Limited Recourse Borrowing Arrangement (LRBA) Provisions” (new legislation guidance) and “Changes to LRBAs for property from 10 August” (SMSF newsroom, 29 July 2026); MA Money broker loan solutions page and broker news update dated 2 November 2026; Broker Daily, “MA Money launches near-prime SMSF loans”, 3 November 2026; Australian Broker, “MA Money launches Near Prime loans for self-managed super funds”, 2 November 2026; MPA, “MA Money evolves SMSF lending range as resi ban bites”; Grant Thornton client alert, “SMSF property borrowing changes are now law”; Boyce, “SMSF LRBA ban and the business real property test”, Julie Schofield, 3 July 2026; ASIC Regulatory Guide 273, Mortgage brokers: Best interests duty. Figures and criteria are as published at 4 November 2026.
Interactive · Broker Decision Helper
Where Does This SMSF File Sit After 10 August?
Four questions to work out which conversation you are actually in, and what the file needs to evidence. General information only — it is not advice on any particular fund.
Question 1 of 4
What is the client asking you to do?
The ATO carve-outs treat a new acquisition and an existing arrangement very differently.
Question 2 of 4
Question 3 of 4
How is the property used?
The statutory test is business real property — land and buildings used wholly and exclusively in one or more businesses. Your client’s SMSF adviser answers this, not you.
Question 4 of 4
What does the credit history look like?
This decides which tier of a lender’s matrix you are working in, not whether the arrangement is permitted.
What the file needs
No answers selected yet.
Built from Australian Taxation Office guidance on the limited recourse borrowing arrangement provisions and its SMSF newsroom item on changes from 10 August, plus client commentary from Grant Thornton and Boyce. It does not reflect any individual lender’s credit policy. Confirm the superannuation position with the trustee’s SMSF adviser and the lending position with your licensee and the lender’s current product guide.
Disclaimer: This article is for general information and professional development purposes only. It does not constitute legal, compliance, taxation, superannuation or financial advice. Whether a particular property satisfies the business real property test, and whether a particular arrangement is grandfathered, are questions for the trustee’s SMSF adviser, accountant or lawyer. Brokers should consult their aggregator’s compliance team and, where required, seek independent legal advice regarding their obligations under the National Consumer Credit Protection Act 2009 and ASIC’s responsible lending guidelines.
