Doctors: Have you considered a review of your SMSF lending?

For a long time, refinancing a Self-Managed Super Fund (SMSF) loan often wasn’t worth the effort.

Not just for brokers.

For clients too.

The process was slow, paperwork-heavy and in many cases the savings simply didn’t justify the complexity.

That has changed significantly over the past 18 months.

A number of lenders have simplified their SMSF refinance processes, particularly for professional clients with strong repayment history and clean conduct on existing facilities.

We’re now seeing scenarios where refinancing can be completed with far less friction than many clients realise.

Daniel recently discussed a refinance scenario involving an SMSF commercial property loan of around $2 million where the client achieved savings of approximately 40 basis points, equating to roughly $3,000 annually, through a process that was materially simpler than would have been possible even 18 months ago.

For some borrowers, it may mean:

• reduced interest rates
• lower ongoing costs
• simplified structures
• improved cash flow within the fund
• materially less paperwork and administration than traditional SMSF refinancing processes

In some cases, lenders are now accepting six months’ strong repayment conduct in place of the far more complex reassessment processes historically associated with SMSF refinancing.

That has changed the conversation significantly.

Historically, SMSF refinancing could become so administratively heavy that many clients understandably chose not to revisit it.

The process is now materially simpler with certain lenders.

That has changed the cost-benefit equation.

Importantly, this doesn’t mean every SMSF loan should be refinanced.

In many cases, the existing structure may still be the best fit.

But given how much lender policy and pricing has shifted recently, it may now be worth reviewing facilities that were originally established several years ago.

This is particularly relevant for doctors and medical professionals who:

• own consulting rooms or commercial property through SMSF structures
• established lending during higher rate environments
• have experienced changes to income, business structure or asset position
• want to understand whether their current lending remains competitive
• may have previously dismissed refinancing because the process felt too complex or time consuming

For medical professionals with busy practices and limited time, that last point matters.

Historically, even where savings existed, the administrative burden often outweighed the benefit.

That balance appears to be shifting.

Importantly, this is not simply about chasing a lower rate.

In many cases, the conversation is broader:

• improving long term cash flow within the fund
• simplifying lending structures
• reducing unnecessary complexity
• reviewing whether the existing setup still aligns with the fund’s long term strategy

And in some cases, after reviewing the structure properly, the recommendation may still be to stay where you are.

But after years where many SMSF borrowers simply avoided revisiting their lending altogether, the process is now materially easier than many people realise.

Areas we’d like Daniel to expand on before publishing:

• Recent examples and scenarios he’s seeing in market

$2M commercial property refinance for a better interest rate.

$750k commercial property refinance for a better interest rate.

Both within the last 6-months. Never been approached for this in my prior 6-years experience

• Which lender policies have materially improved

Well-established non-bank lenders have considered that this lending is non-coded /non-NCCP / not consumer regulated. They don’t need to technically demonstrate borrowing power like banking home loan providers. Given the client already has the debt, has good conduct, they will simply refinance with a better interest rate. Good for the client.

• What “streamlined assessment” practically looks like

As above

• Timeframes compared with traditional SMSF refinancing

Timeframes change little given a full valuation is conducted on the security property. This is the limiting time-factor

• Situations where refinancing may not be worthwhile

If the rate is higher (why do it)

Decrease in property value

• Whether this applies more to commercial property than residential SMSF lending

Applies to either

• Additional considerations specific to doctors and medical professionals

Some medico’s may have high LVR lending for their commercial practice. Chances are low. The providers offering easy-refinances will limit a loan LVR to 80% resi and 75% commercial.