An SMSF loan is a type of loan that is available for self-managed super funds (SMSFs). These loans are specifically designed for SMSFs to purchase investment properties. SMSF loans are generally available for residential, commercial, and industrial properties and can be used to purchase properties outright. They cannot be used for construction.

The key benefit of an SMSF loan is that it allows SMSFs to access additional funds to purchase property, which can help to diversify their investment portfolio. 
Lending is done with non-recourse borrowing arrangements. This means the lender does not have a recourse or right on other assets in the SMSF. For this reason, the lender (bank) will ask the Members of the SMSF for a guarantee.
However, it is important to note that SMSF loans are subject to strict lending criteria and may carry higher interest rates and fees than traditional investment loans. Additionally, SMSF loans require careful management to ensure that the SMSF remains compliant with superannuation laws and regulations. Lending can be either for residentail property or commercial property. Refer to the diagrams below. Always seek advise from your lawyer and accountant as there are many regulations that must be adhered to.