SMSF limited recourse borrowing arrangement (LRBA)
A limited recourse borrowing arrangement allows a self-managed super fund to borrow to acquire eligible property held in a separate holding trust, with the lender's recourse against the fund limited to that property.
SMSF limited recourse borrowing arrangement, explained.
The fund pays the deposit and costs, the holding (bare) trust holds legal title until the loan is repaid, and the fund receives the rent and meets the repayments. Deposit requirements depend on the lender and property; lenders assess the fund's liquidity after settlement, the members' contributions and the rent.
From 10 August 2026 a fund can borrow to acquire real property only where it is business real property. Members and related parties cannot live in or use property the fund owns. Eligible business premises may be leased to a member's business, subject to the applicable SMSF rules and market terms. Arrangements entered before that date are treated separately.
Tools that use this term.
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Loan repayments calculator: principal and interest, interest-only for a period, weekly or monthly, with or without extra repayments.
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The Learn section is general information about lending in Australia. It does not take account of your objectives, financial situation or needs, is not credit assistance, and is not tax, legal or financial advice. Lender policies, government schedules and regulations change; check the current position with the relevant body or with us before relying on it.
