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Borrow to invest NAB SUPER LEVER
Designed to help SMSFs boost their investment portfolio

SMSF-friendly

Take advantage of a limited recourse loan

Simple set up

The required security trust is provided with the product

Flexible investing

Access over 350+ approved investment options

Borrowing through super to invest is now possible with NAB Super Lever – one of the only lending solutions in the market that lets you borrow to invest in shares, ETFs and managed funds.

Amplify your investment power

SMSFs can borrow to invest by using what is known as a “limited recourse borrowing arrangement” (LRBA). To establish an LRBA, your SMSF will need to take out a loan with a lender and invest the borrowed money and some cash already in your fund. The lender / security trustee can then purchase the assets on your behalf.

NAB Super Lever enables you to amplify your investment power by giving you the opportunity to expand the pool of assets working for you.

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NAB Super Lever - designed specifically for SMSFs

If you’re considering borrowing to invest as part of your investment strategy NAB Super Lever offers SMSFs:

  • 350+ listed securities and managed funds to borrow against
  • A commercial LRBA solution and margin loan
  • Flexibility to repay the loan principal in a manner and time frame that suits your fund
  • Simplicity and ease with the required Security Trust integrated into the product structure allowing for multiple transactions at no extra cost
  • Loan administration and asset purchasing done by NAB

With variable and fixed rates as an option, borrowing to invest in shares may be a cost effective strategy for SMSFs, particularly if you want a bigger asset pool working for you.

There are risks associated with borrowing to invest so always do your research or speak to your financial adviser before deciding to invest.

For NAB Super Lever enquiries contact the NAB Equity Lending team on 1300 135 145.

For NAB Super Lever enquiries contact the NAB Equity Lending team on 1300 135 145

Use leverage to grow your SMSF assets

NAB Super Lever is a limited recourse borrowing arrangement specifically designed for SMSFs. You can use NAB Super Lever to aquire approved shares, ETFs or managed funds for your SMSF.

As an example, for those that want to embed some diversification into each borrowing arrangement, NAB Super Lever has a broad approved list of managed funds and exchange traded funds (ETFs).

Borrowing funds in a compliant fashion is one of the few pathways available to an SMSF trustee to increase the gross asset pool working for them within superannuation’s concessional tax environment. 

With NAB Super Lever, SMSF trustees enjoy: 

  • The required Security Trust structure is provided within the product
  • A broad range of approved investments and the ability to control gearing levels

While a margin loan can increase gains in a rising market, it can also magnify losses when the market declines. Find out more about the risks and benefits of a NAB Super Lever below.

Interest Rates

Variable interest rates (p.a.)
Less than $250,000 7.05%
$250,000 - less than $1.0M 6.80%
$1.0M & above 6.55%
Fixed interest rates - interest-in-advance (yearly)
  1 year (p.a.) 2 years (p.a.) 3 years (p.a.) 4 years (p.a.) 5 years (p.a.)
Less than $250,000 7.20% 7.35% 7.50% 7.65% 7.80%
$250,000 - less than $500,000 7.00% 7.15% 7.30% 7.45% 7.60%
$500,000 - less than $1.0M 6.80% 6.95% 7.10% 7.25% 7.40%
$1.0M & above 6.60% 6.75% 6.90% 7.05% 7.20%

How to apply in a few steps

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EDUCATE

 

Read and ensure you understand the information before starting your:

 

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APPLY

 

Complete and submit the application form, including the SMSF audit report and trust deed.

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APPROVAL

 

Your application and trust deed is reviewed and if approved, your NAB Super Lever facility will be setup.

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INSTRUCTIONS

 

Complete a Loan Request form and provide instructions to acquire the new investment/s.

Analysis

 

NAB Super Lever already has the Security Trustee inbuilt and integrated into the structure, so you’ll only need to concentrate on:

  • what you want to invest in
  • how much gearing is appropriate
  • how you plan to manage the loan interest

Always do your research or speak to a financial adviser.

 

Benefits

Limited recourse

Recourse against the SMSF is limited to the acquired asset held as loan security, in addition to this maximums apply to the value of assets acquired.

Contributions 

Borrowing funds to acquire an asset under a limited recourse borrowing arrangement does not increase the net capital value of your SMSF, so it should not result in a contribution to your fund for ATO purposes.

Simplicity and flexibility

If you decide to make an investment, you simply send us a form with your investment request and arrange to provide the required cash contribution. Also, the required Security Trust structure is provided within NAB Super Lever. 

As the SMSF trustee, you can choose:

  1. your investment from a broad range of approved investments
  2. your preferred gearing level
  3. whether to capitalise loan interest
  4. whether to make use of non-SMSF security to support a loan via a guarantee, and 
  5. when to repay the loan.

Unconditional access to investment distributions

Cash dividends and distributions flow directly to you as the beneficial owner of the financed investment.

These income flows are available for you to reinvest within your SMSF, or you may choose to reduce an existing NAB Super Lever loan balance.

Risks

Increased losses

While leverage may amplify gains, it also amplifies any losses in a falling market.

Reduced security LVRs

Lending ratios are regularly reviewed and may decrease, even for securities an investor already owns. When that happens, it can sometimes trigger a margin call.

Personal guarantee required from fund members

If the acquired asset needs to be sold to correct a margin call and the sale proceeds from selling the asset doesn't completely repay the loan, the individual fund members will need to repay the residual loan balance from sources other than the SMSF.

Increased rates

If you have a variable interest rate on your loan, it may increase. To manage this risk, investors should ensure they gear conservatively and have enough capital to deal with a rate rise. Investors can manage this risk by offsetting any distributions or income received from securities against the balance of the loan. 

Margin calls

If a portfolio's value falls so that the amount of equity an SMSF investor holds also falls below the required levels, extra security or funds may need to be deposited. If an SMSF fails to do this, their financial assets (the loan security) may be sold to correct the position.

 

Risk management and things to consider for SMSFs

It’s important to be aware that while a margin loan can increase your gains, it can also magnify losses.

As NAB Super Lever is a limited recourse margin loan, your SMSF’s loss is limited to the investments purchased with funds advanced under the NAB Super Lever facility. If the acquired asset needs to be sold to correct a margin call, and the sale proceeds from selling the asset doesn’t completely repay the loan, the individual fund members will need to repay the residual loan balance from sources other than their SMSF.

You should also be aware of your obligation as trustee of a superannuation fund to formulate and implement an appropriate investment strategy that considers the whole circumstance of the fund and to act in the best interests of the members of the fund. This includes ensuring you are familiar with the risks involved and have in place adequate risk management procedures to manage the risks associated with borrowing to fund an investment. Relevant to this consideration will be the risks of a leveraged investment and factors such as the diversification of the assets of the superannuation fund and the overall level of gearing of the fund.

Be sure to take the time to do your research, read the Product Disclosure Statement (PDS) and talk with your financial adviser before deciding to invest.

 

For NAB Super Lever enquiries contact the NAB Equity Lending team on 1300 135 145