AMP BankAMP SuperEdge Loan

About this product brochure

This product brochure contains information about self managed superannuation fund (SMSF) loans issued by AMP Bank Limited ABN 15 081 596 009, Australian credit licence 234517, AFSL No. 234517 (AMP Bank). AMP Bank’s loans to SMSFs are called AMP SuperEdge loans.

It will help you to decide whether the AMP SuperEdge loans are right for you. It will also help you to compare the AMP SuperEdge loans with other SMSF loans.

Important information

The product brochure only contains factual information. It does not contain any financial product advice.

This information does not take into account your objectives, financial situation and needs.

Information on any legal requirements for SMSF loans is based on AMP Bank’s understanding of current laws and their interpretation as at the date of this product brochure.

We strongly recommend that you obtain advice from both your financial adviser or accountant, and your legal adviser before taking out an AMP SuperEdge loan.

Whilst every effort has been made to ensure the information is accurate as at the date of this product brochure, this document only provides a brief summary of AMP Bank’s loans to SMSFs and their legal context. It does not contain a complete description of the Terms and Conditions that apply to AMP SuperEdge loans. Terms and Conditions are available on request.

Fees and charges apply, Information about the fees and charges applicable to AMP SuperEdge loans is contained in our Home Loan Fees and Charges Guide.

If there is any inconsistency between this product brochure and the Home Loan Fees and Charges Guide, or Terms and Conditions, the Home Loan Fees and Charges Guide or Terms and Conditions will prevail.

The credit provider is AMP Bank Limited ABN 15 081 596 009, Australian credit licence 234517, AFSL No. 234517 and applications for AMP SuperEdge loans are subject to AMP Bank guidelines.

If we approve an AMP SuperEdge loan application for an SMSF we make no representation that the residential investment property being acquired is a suitable investment. We disclaim all liability in this regard.

Entering into a borrowing arrangement that does not comply with superannuation law may result in the SMSF losing its ‘complying superannuation fund’ status, with serious adverse tax consequences. We disclaim all liability in connection with any failure by the SMSF trustee or its directors, members or associated persons to comply with superannuation law.

For further information about our loans for SMSFs, please contact us using any of the methods below.

ContentsImportant information� Inside�front�cover

Glossary� 3

Self managed super fund loans: Introduction� 3

How do AMP SuperEdge loans work?� 4

Case study: So what does it look like in reality?� 4

Step 1: The SMSF trustee acquires beneficial interest� 5

Step 2: The SMSF trustee becomes legal owner of the property� 7

Key documents� 8

More about AMP SuperEdge loans� 9

Variable and Fixed Rate AMP SuperEdge loans� 9

Loan terms, amounts and Loan to Value Ratio (LVR)� 9

Requirements and restrictions� 9

Our rights against the SMSF trustee, its directors and the security custodian� 10

The National Credit Code� 10

AMP SuperEdge loan application checklist� 12

Legal requirements for SMSF loans� 14

‘Limited recourse’ loan exception� 14

Special in-house asset rule� 14

ATO guidance� 14

Other legal requirements� 14

Frequently asked questions� 15

Contact us� Back�cover

Complaints� Back�cover

An AMP SuperEdge loan is a ‘limited recourse’ borrowing arrangement — a loan made by AMP Bank to the trustee of your SMSF for the purpose of that trustee acquiring a residential investment property. The security custodian then holds the property in the security trust.

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Glossary

SMSF loans: Introduction

In this product brochure:

Security custodian means the trustee of the security trust, which holds the residential investment property on trust for the SMSF.

SIS Act means the Superannuation Industry (Supervision) Act 1993 (Cth).

SIS Regulations means the Superannuation Industry (Supervision) Regulations 1994 (Cth).

SMSF means a self managed superannuation fund and has the meaning given by section 17A of the SIS Act.

SMSF member means an individual who is entitled to receive a benefit from the SMSF and who is either an individual trustee or a director of a corporate trustee of the SMSF.

Security trust means the trust that is established to hold the property on trust for the SMSF. May also be referred as the ‘Security Custodian Trust’, ‘Property Trust’, or ‘Bare Trust’.

SMSF trustee means the individuals or company appointed as the trustee of the SMSF.

We, Us, Our or AMP Bank means AMP Bank Limited ABN 15 081 596 009, Australian credit licence 234517, AFSL No. 234517 and its successors and assigns.

You means the SMSF trustee. If there is more than one of you, you means each of you separately and every two or more of you jointly. You includes your successors and assigns.

The singular includes the plural and vice versa.

An SMSF loan is exactly what its name suggests — it is a loan to your SMSF trustee .

The SIS Act generally prohibits the trustee of a regulated superannuation fund, which includes SMSFs, from borrowing money. However, it does allow an SMSF trustee to borrow money to acquire certain kinds of assets, including residential investment property, provided that certain conditions are met.

One of these conditions is that any rights of the lender or other person against the SMSF trustee is limited to the asset acquired with the borrowed money. This is what is often referred to as a ‘limited recourse’ loan.

You can find more details about the requirements for SMSF borrowings on page 14 of this brochure.

An AMP SuperEdge loan is a loan made by AMP Bank to your SMSF trustee for the purpose of financing or refinancing the acquisition of a residential investment property.

The security custodian trustee will acquire the property using a deposit paid from the SMSF together with the AMP SuperEdge loan.

The security custodian will be the legal owner of the property but will hold the property on trust for the SMSF trustee. This trust is called the security trust. The SMSF trustee will have a right to become the legal owner of the property by repaying the SMSF loan in full.

The features and characteristics of AMP SuperEdge loans are set out on page 9, and you will find a checklist for AMP SuperEdge loan applications on page 12.

Before we approve and finalise a loan to your SMSF, you must obtain advice from both your financial adviser or accountant, and your legal adviser before taking out an AMP SuperEdge loan.

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How do AMP SuperEdge loans work?

Your SMSF trustee uses an AMP SuperEdge loan to acquire a residential investment property.

Case study: So what does it look like in reality?(Names and places are fictitious and for illustrative purposes only)

Ian, 51 is a chiropractor, and his wife Sandra, 49 a dietician, together run a successful practice in Sydney’s CBD.

They have been contributing to standard industry superannuation funds for many years.

They see their financial adviser and after talking through their options, take all the necessary steps to set up their own SMSF called The Iansan Super Fund – in doing so, they also choose to have a corporate trustee for their SMSF (Moonie Pty Ltd) of which they will be the directors.

Ian and Sandra decide that they want to include residential property in their SMSF’s investment mix. So they re-visit their adviser, who is qualified to advise them on borrowings for their SMSF.

They have $300,000 in cash in their SMSF and have found an investment property worth $500,000 which they would like to purchase.

With further assistance from their financial and legal advisers, they set up a security trust which will be used to hold their SMSF’s property asset (as required by the superannuation borrowing laws).

As the directors of Moonie Pty Ltd (the corporate trustee for their SMSF), Ian and Sandra arrange to buy the property and use $175,000 in cash to make an initial payment for the property. The shortfall of $325,000 plus $25,000 in stamp duty and acquisition costs is funded by a ‘limited recourse’ loan, using the property as security.

Ian and Sandra arrange for an AMP SuperEdge loan to be provided to their fund in order to cover this shortfall. The SMSF will initially qualify for the loan as the SMSF:

− Meets the pre-purchase minimum net asset position of $200,000

− Passes the liquidity test of at least 10% of total assets, after settlement. The SMSF will still have $125,000 remaining as liquid assets after the purchase has been completed.

Both Ian and Sandra are also required to provide AMP Bank with personal guarantees for this loan.

Ian and Sandra choose a variable interest rate loan option and link a 100% offset account to it. This means that every dollar their SMSF holds in the Offset Deposit Account effectively reduces the amount of interest the fund will pay on the loan.

During the term of the loan, the legal title to the property is held by the trustee of their security trust – as required by superannuation law, while loan repayments are made by the SMSF itself.

The property is leased to an unrelated third party. The rental income, as well as any other income generated by the SMSF, plus Ian and Sandra’s regular super contributions will all go into their SMSF. The SMSF is responsible for making repayments on the loan to AMP Bank and can use any or all of these amounts to make these repayments.

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Step 1: The SMSF trustee acquires beneficial interestThe first step is that the SMSF trustee establishes the security trust and appoints the security custodian as the trustee of the security trust.

The Security custodian: The trustee of the security trust (also commonly known as a bare trust) purchases the residential investment property from

the vendor and enters into the Contract of Sale

The SMSF trustee: Moonie Pty Ltd

Ian and Sandra are the directors

The SMSF: The Iansan Super Fund

The SMSF members: Ian and Sandra

AMP Bank

Vendor

Guarantee (as security provider)

The Borrower

Guarantees by directors of SMSF trustee – in their

personal capacities

Hold legal title to the residential investment

property

Holds the beneficial interest in the SMSF

Holds the beneficial interest in the

residential investment property

Registered first mortgage

The residential investment property: 11 Newtown Crescent, Newtown

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The security custodian then acquires the residential investment property using a deposit paid from the SMSF together with the AMP SuperEdge loan given to the SMSF trustee.

We (AMP Bank) will lend the SMSF trustee up to a maximum of 70% of the value of the residential investment property, towards the purchase price.

The security custodian will be the legal owner of the residential investment property and will hold it on trust for the SMSF trustee. By doing so, the SMSF trustee will acquire a beneficial interest in the residential investment property. The SMSF trustee will have the right to become the legal owner of the residential investment property once it has repaid the AMP SuperEdge loan in full.

Our loan to the SMSF trustee is guaranteed by the security custodian and each director of the SMSF trustee, which is a corporate trustee.

We will take a registered first mortgage over the residential investment property as security. The security custodian as the legal owner of the residential investment property will grant us that mortgage.

The SMSF is entitled to any income produced by the residential investment property. The SMSF trustee may use this income (and any other SMSF income or assets) to make loan repayments to us. The SMSF trustee pays the expenses of the residential investment property out of the SMSF income or assets.

Important

– The vendor cannot be a related party of the SMSF (so, for example, your SMSF cannot buy a property from a member of the same SMSF).

– The security trust cannot hold any property other than the residential investment property.

– The residential investment property and the income it produces cannot be subject to any charge other than AMP Bank’s registered first mortgage.

– If we exercise our rights under a guarantee or the mortgage, any rights of recovery the security custodian or the directors of the SMSF trustee may have against the income or assets of the SMSF are limited to rights relating to the residential investment property.

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Step 2: The SMSF trustee becomes legal owner of the property

The SMSF

The SMSF trustee

The SMSF members

AMP Bank

The Security custodian

repays loan to

Discharge of mortgage

Transfers legal title to SMSF Trustee

Hold legal and beneficial title to the residential investment property

Hold beneficial interest in SMSF

In Step 2, when the SMSF trustee repays our AMP SuperEdge loan (and any related expenses) in full, it will have the right to become the legal owner of the residential investment property.

AMP Bank will then discharge the mortgage over the residential investment property and release the guarantees given in respect of the AMP SuperEdge loan. The security custodian will then transfer the legal title to the residential investment property to the SMSF trustee.

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Key documentsCertain key documents are required to set up an AMP SuperEdge loan under Step 1 (in addition to the contract for sale of land between the vendor and the security custodian). Some of these documents are prepared by us, while other documents are prepared by you or your professional advisers.

Documents prepared by you/your advisers

Security trust deed. This establishes the security trust between the security custodian and the SMSF trustee and specifies their respective rights and obligations

Trustee resolution to enter into the arrangements

Security custodian resolution to enter into the arrangements

(If required) Deed amending the SMSF trust deed to allow the SMSF trustee to acquire the residential investment property and enter into the loan agreement

If you are refinancing an existing SMSF loan from another institution, evidence of conduct of payment on loans being refinanced, such as loan statements

.

Documents prepared by AMP Bank

AMP Bank loan details and loan conditions. Together these documents are the loan agreement between us and the SMSF trustee

AMP Bank guarantee and indemnity details and conditions. Together these documents are the guarantee which the security custodian and each director of the SMSF trustee (if applicable) gives to us

AMP Bank Mortgage Memorandum. This secures the performance of the SMSF trustee’s obligations under the loan agreement and the security custodian’s obligations under the guarantee

Certification of Advice to be completed and signed by a financial adviser or accountant

Certification of Legal Advice by Fund Trustee to be completed and signed by the SMSF trustee

Statutory Declaration to be completed and signed by the SMSF trustee

Certification of Legal Advice provided to all guarantors regarding the borrowing

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More about AMP SuperEdge loans

An AMP SuperEdge loan is a loan that can be used by an SMSF to purchase a residential investment property.

It is available to an SMSF trustee of a complying SMSF. The SMSF trustee may be two or more individual trustees or a corporate trustee (which is a non-trading company that has been set up for the sole purpose of being the SMSF trustee).

The AMP SuperEdge loan may be used by an SMSF trustee to purchase a residential investment property with a new loan from AMP Bank, or to refinance (on a dollar for dollar basis) an existing SMSF loan held with another institution.

The AMP SuperEdge loan is secured by a registered first mortgage on the investment property.

The borrower of an AMP SuperEdge loan is the SMSF trustee.

Variable and fixed rate loansThe AMP SuperEdge loans are available both as variable rate and fixed rate loans:

– AMP SuperEdge Variable Rate loan maximises your financial flexibility and is available for interest only (for up to 5 years) as well as principal and interest. Repayments can be made monthly, fortnightly or weekly on principal and interest loans, and monthly on interest only loans. You can also choose how much you want to pay over the minimum repayment amount. You can also choose to have up to 10 Offset Deposit Accounts per variable loan split.

– AMP SuperEdge Fixed Rate loan is a simple and straightforward loan. This loan gives you the certainty of fixed repayments and protects you if interest rates rise. You can choose the term of your fixed rate loan. Fixed rate loans are available for 1, 2, 3 or 5 year terms. Repayment options are available for both interest only (for up to 5 years) and principal and interest. Repayments can be made monthly, fortnightly or weekly on principal and interest loans, and monthly on interest only loans.

Loan terms, amounts and Loan to Value Ratio (LVR)

– The minimum loan amount is $100,000 and the maximum loan amount is $750,000 (subject to location).

– The minimum loan term is 10 years and the maximum loan term is 30 years. A 5 year interest only period is available.

– The maximum loan to value ratio is 70% of the value of the security property.

Requirements and restrictionsThe following are some of the requirements and restrictions that apply to AMP SuperEdge loans:

– The directors of a corporate SMSF trustee are required to give personal guarantees.

– The security custodian (which must be a corporate trustee) is also required to give a guarantee for the SMSF trustee/s.

– We require a certification of advice given by a financial adviser or accountant to the SMSF trustee.

– We require a certification of legal advice to be completed and signed by the SMSF trustee.

– We require a certification of legal advice for each guarantor.

– Loan increases are not permitted.

– Product switching is only permitted to and from SMSF loan products.

– No redraw is permitted.

You should read all the documents we give you in relation to the AMP SuperEdge loan as these documents will outline all the requirements and restrictions that will apply to your AMP SuperEdge loan.

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Our rights against the SMSF trustee, its directors and the security custodian

Loan agreement and mortgage

To secure the repayment of the AMP SuperEdge loan, we require the security custodian to grant us a registered first mortgage over the residential investment property.

If the money owing under the loan agreement is not repaid in full, we may exercise our rights under the mortgage and sell the property and keep the sale proceeds to repay the amount owing to us.

Under the loan agreement, our rights of recovery against the income and assets of the SMSF are limited to rights relating to the residential investment property. This protects the other assets of the SMSF.

Where the SMSF trustee is one or more individual trustees, our rights of recovery against them personally are not so limited and we may recover from them any money owing under the loan agreement.

Guarantees

We also require the security custodian and each director of the SMSF trustee to give us a guarantee.

If the money owing under the loan agreement is not repaid in full, we may exercise our rights under the guarantees to recover the outstanding amount from one or more of the security custodian and any director of the SMSF trustee.

However, any rights of recovery that the security custodian or the directors of the SMSF trustee may have against the income and assets of the SMSF are limited to rights relating to the residential investment property.

The National Credit CodeIf the SMSF trustee is one or more individual trustees (that is, natural persons), the National Credit Code applies to the loan agreement between us and the SMSF trustee/s.

An AMP SuperEdge loan is a loan that can be used by an SMSF to purchase a residential investment property.

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Here is a list of requirements that must be met and that you need to be aware of, before applying for an AMP SuperEdge loan. You should note that any AMP SuperEdge loan approval is also subject to AMP Bank guidelines.

The residential investment property

– Must be an investment (ie it cannot be owner-occupied).

– Must be already constructed and have its own separate title details (ie no construction loans).

– Must be established for more than 6 months prior to application. (no off-the-plan purchases)

– Must be zoned residential or rural residential (ie no part residential, part commercial is allowed).

– Must be fully serviced by power, water, electricity, and sewerage and have road access.

– No company title, serviced apartments or display homes.

– No more than 2 residential units on one title.

– For strata title properties with more than one title and where registration of the transfer of the strata unit requires transfer of both titles, both titles can be used as security (ie if for example, a garage is on a separate title to a unit, and the two titles must always be registered together, both titles over the unit and the garage can be financed by the same loan).

– The maximum land area is 2.2 hectares (5 acres).

– We lend up to a maximum of 70% of the value of the residential investment property.

– An AMP SuperEdge loan can be used to refinance an existing SMSF loan with another financial institution, on a dollar for dollar basis only.

– An AMP SuperEdge loan cannot be used for renovations.

– We take a registered first mortgage over the residential investment property (see below). No second mortgage or other kind of charge over the residential investment property is ever permitted.

The vendor

– The vendor of the residential investment property must not be a related party of the SMSF. (Your legal adviser, financial adviser or accountant will be able to explain the meaning of ‘related party’ to you.)

Capacity to service loan

– You must demonstrate the capacity of the SMSF trustee to service the AMP SuperEdge loan, to our satisfaction.

Guarantees and registered first mortgage

– The security custodian (see below) and each director of the SMSF trustee (which is a corporate trustee) must agree to guarantee the performance of the SMSF trustee’s obligations under the loan agreement with us. We take a registered first mortgage over the residential investment property.

– We never take any charge over any SMSF asset other than the residential investment property as security for the AMP SuperEdge loan.

AMP SuperEdge loan application checklist

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The security trust

– The security custodian (a company you nominate) must hold the residential investment property on trust (the security trust) for the SMSF.

– The SMSF trustee must be entitled to all income produced by the residential investment property.

– The SMSF trustee must have the right to acquire legal title to the residential investment property when it repays our loan in full.

– The security trust must not hold any property other than the residential investment property. (Our legal advisers will review the terms of the security trust deed to confirm that this requirement is met.)

– The SMSF trustee must have power to enter into the loan agreement with us, either by the terms of the SMSF trust deed or pursuant to borrowing powers conferred by the relevant State or Territory Trustee Act.

– The borrowing must not be prohibited by the terms of the SMSF trust deed. (Our legal advisers will review the terms of the SMSF trust deed to confirm that this requirement is met.)

Your SMSF

– The Self Managed Super Fund (SMSF) must have ‘net assets’ totalling a minimum of $200,000 prior to unconditional approval. AMP Bank requires the following documentation for the SMSF:

– Account statements verifying the total fund holdings (cash) dated within 30 days of the application date.

– Full financial statements for the most recent completed financial year

– Most recent loan statement for any existing debts the SMSF may have with another financial institution dated within 30 days of the application date.

– If the SMSF includes assets other than cash holdings or property, the Bank may seek a valuation of the asset dated within 12 months of the application.

– A minimum of 10% of total assets in liquid assets (cash, term deposits, shares, government bonds) after settlement.

– The SMSF trustee must be an Australian resident.

We reserve our right to reject any particular AMP SuperEdge loan application, in our absolute discretion. We also reserve our right to set the terms and conditions of any particular AMP SuperEdge loan we offer, in our absolute discretion.

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The SIS Act generally prohibits the trustee of a ‘regulated superannuation fund’, which includes an SMSF from borrowing money: subsection 67(1).

There are several exceptions to this general prohibition. One exception, contained in section 67A of the SIS Act, is often referred to as the ‘limited recourse loan’ exception.

Limited recourse loan exceptionAn SMSF loan for the purpose of financing or refinancing the acquisition of a residential investment property must satisfy the requirements in section 67A, along with any other legal requirements that may apply to the SMSF loan.

Briefly, an SMSF loan must satisfy the following requirements in section 67A:

(a) the borrowing must be used to finance or refinance the acquisition of a ‘single acquirable asset’ (the residential investment property) which the SMSF trustee is not otherwise prohibited from acquiring by the SIS Act or any other law. The borrowing may also be used to meet expenses incurred in connection with the borrowing or acquisition (such as conveyancing fees, stamp duty, brokerage or loan establishment costs), or in maintaining or repairing the asset. However, the borrowing cannot be used to meet expenses incurred in improving the asset,

(b) the asset is held on trust (the security trust) so that the SMSF trustee acquires a beneficial interest in the asset,

(c) the SMSF trustee has a right to acquire legal ownership of the asset by making one or more payments after acquiring the beneficial interest in the asset,

(d) the rights of the lender or any other person against the SMSF trustee in connection with any default on the borrowing are limited to rights relating to the asset. This protects the other assets of the SMSF. This limitation applies to any rights of recovery that the security custodian and any director of the SMSF trustee may have against the SMSF as a result of their guarantees and the mortgage,

(e) if, under the arrangement, the SMSF trustee has a right relating to the asset (other than the right to acquire legal ownership) — the rights of the lender or any other person against the SMSF trustee in connection with or as a result of the SMSF trustee’s exercise of their rights are limited to rights relating to the asset, and

(f) the asset is not subject to any charge (including a mortgage, lien or other encumbrance) except as provided for in (d) and (e) above.

Importantly, section 67A does not prevent us from recovering any money owing under the loan agreement from the personal assets of the security custodian, the directors of the SMSF trustee or the individual SMSF trustees.

Special in-house asset ruleIn the case of an SMSF, the security trust will often be a related trust of the SMSF for the purposes of the in-house asset rules. However, the in-house asset rules include an exception which addresses this situation.

If the asset being acquired by the SMSF is the only property of the security trust, the SMSF’s investment in the security trust will not be an in-house asset, provided that the underlying asset would not be an in-house asset of the SMSF if it were held directly by the SMSF: SIS Act, subsections 71(8) and (9).

ATO guidanceThe Australian Taxation Office (ATO) has issued guidance on section 67A of the SIS Act called Limited recourse borrowing arrangements by self-managed super funds – questions and answers (29 July 2010), which is available on the ATO website at ato.gov.au.

Other legal requirementsThere may be other legal requirements under superannuation law or the SMSF trust deed that are relevant to AMP SuperEdge loans.

Before applying for an AMP SuperEdge loan, we strongly recommend that you obtain advice from your legal adviser on any other legal requirements that you must comply with.

Legal requirements for SMSF loans

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Can I use an AMP SuperEdge loan to refinance an existing limited recourse loan?

Yes, you can use an AMP SuperEdge loan to refinance an existing limited recourse loan1, subject to the following conditions:

– the AMP SuperEdge loan must be in respect of the same residential investment property, and

– if a different security custodian is used, legal title to the residential investment property must be transferred directly from the old security custodian to the new security custodian.

Can I replace the residential investment property before my AMP SuperEdge loan is repaid?

No, you cannot provide any replacement security for your AMP SuperEdge loan before the loan is repaid in full.2 In particular, you cannot substitute another residential investment property as security for the original residential investment property before the loan is repaid in full.

What happens when I pay out my AMP SuperEdge loan

If your AMP SuperEdge loan is repaid in full and the residential investment property is either transferred to the SMSF trustee or sold, you can apply for a new AMP SuperEdge loan to acquire another residential investment property.

When can I apply for a new AMP SuperEdge loan?

You can apply at any time however the new loan will need to have a new custodian and new security trust set-up.

Who is the property purchaser on the contract of sale?

The Security Custodian Trustee will be the purchaser on the contract of sale. The Security Custodian Trustee will sign the contract.

Do I need to set up a Security Trust? Can I set up the AMP SuperEdge loan without it?

You cannot apply for an AMP SuperEdge loan without a Security Trust in place as the SIS Act requires the property being purchased to be held under this type of trust arrangement.

You should seek advice from a financial adviser or accountant, and legal advice from suitably qualified professionals about what is required to enable your SMSF to borrow money to purchase residential investment property.

In whose name is an AMP SuperEdge loan held (ie who is the borrower?)

The borrower is the SMSF Trustee, which can either compromise individual trustees (for example: Jay Johns and Jackie Johns as trustees for The Johns Self Managed Super Fund) or a corporate trustee (for example: Blue Spark Pty Ltd as trustee for The Roberts Self Managed Super Fund).

What types of properties does AMP Bank accept as security for AMP SuperEdge loans?

Only residential property is acceptable. Location restrictions may apply. Types of properties that are not acceptable include but are not limited to owner occupied property, vacant land, properties on multiple titles, properties established for less than 6 months at the time of application and off the plan properties. Acceptable properties are subject to AMP Bank criteria and approval.

Does AMP Bank require any of the parties to an AMP SuperEdge loan to provide guarantees?

The Security Custodian Trustee (which must be a company) will be required to provide a guarantee in support of an AMP SuperEdge loan. AMP Bank will also require personal guarantees from the directors of the corporate trustee of the SMSF trust. Individual trustees will be liable for the loan both in their trustee capacity and in their personal capacity.

How many properties can be used as security for an AMP SuperEdge loan?

One. Your SMSF can only use the one property as security for each AMP SuperEdge loan.

You should seek advice from a financial adviser or accountant, and legal advice from suitably qualified professionals about what is required to enable your SMSF to borrow money to purchase residential investment property.

Frequently asked questions

1 See Australian Taxation Office, Limited recourse borrowing arrangements by self-managed super funds – questions and answers (29 July 2010).

2 This is because in circumstances where the asset being acquired by a superannuation trustee is a residential investment property and the money originally borrowed by the superannuation trustee has not been repaid in full. Sections 67A and 67B of the SIS Act do not permit that asset to be replaced by another asset.

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Contact usAMP�Bank�Limitedphone 13 30 30email info@ampbanking.com.aumail Locked Bag 5059, PARRAMATTA NSW 2123fax 1300 555 503web amp.com.au

ComplaintsIf you have a complaint, call us at the number above or write to us.

If you are not satisfied with our complaint resolution process, you can take the case to the Financial Ombudsman Service (FOS). The FOS’s contact details are:

phone 1300 780 808web fos.org.au

AMP Bank Limited ABN 15 081 596 009, Australian credit licence 234517, AFSL No. 234517.