Self-Managed Super Funds
Set up your SMSF
Thinking of setting up your own Self-Managed Superfund? Self-Managed Super Funds Let us get it done for you. Scroll down for more information.
Solicitor Certificates for purchasing via SMSF
When you intend to purchase property via your SMSF with a lender, chances are you will be asked to obtain a Solicitor Certificate. We are highly experienced in providing Solicitor Certificates for this purpose. We can arrange to provide this certificate to you within 48 hours of reviewing your SMSF loan documents. Contact us today. Self-Managed Super Funds.
Acquiring a solicitor certificate for an SMSF loan requires the lawyer in question to witness the signature of the borrowers. We will review all the documents present and explain the nature of the loan terms and conditions to ensure that the borrower is fully aware of the contractual promises. The solicitor’s signature on the certificate is a professional promise to the bank that the advice has been given, so lawyers have to make sure that all the paperwork is in order and that all parties understand the full implications of what they are agreeing to.
Investing in your Super
One of the benefits of having your own SMSF is that you are in the driving seat when it comes to choosing your SMSF in Solicitor Certificates Self-Managed Super Funds vestments. There are many rules to adhere to when buying property with your SMSF so it is important to get sound advice on how to purchase property with your SMSF and to do it the right way.
SMSF services for you
Need a Solicitor Certificate? You've come to the right place!
What is a Solicitors Certificate?
You've received your SMSF loan documents from the lender and you're ready to go. However, you notice that the lender is asking for a Solicitor's Certificate. What is it?
Borrowers and guarantors in SMSF transactions are often required to obtain independent legal advice before they can draw down on their loan.
A solicitor certificate is a document signed by your solicitor certifying that you received this legal advice. A Solicitor’s Certificate is a certificate of Independent Legal Advice to a borrower or guarantor in relation to a loan. In providing legal advice, a Solicitors Certificate confirms to a lender that a borrower or guarantor has received independent legal advice and understands the potential liabilities and risks involved in signing the security documents.
In providing legal advice, solicitors are governed by laws and regulations not only in relation to Legal Profession Uniform Law in New South Wales.
Why do I need a Solicitor's Certificate?
The short answer is that the lender wants you to understand your obligations under the loan documents. This is because the lender is concerned that its loan documents and mortgage may not be enforceable against you if it is shown (later down the track) that you did not understand the documents or you were unduly influenced by a third party. A solicitor certificate helps the lender manage this risk by ensuring that you have the documents explained to you.
Note, a Solicitor's Certificate isn’t a document that should be obtained lightly, and there are multiple risks involved for the guarantor if they aren’t paying attention.
How long will it take to receive a Solicitors Certificate?
We require at least forty-eight (48) hours to review the documents between when they are received by our office to when the advice is provided. In urgent situations, such as when settlement is about to take place, we can arrange to have a certificate issued within 3 hours from receipt of all required documentation.
Once we review the documents, we will arrange to meet you to discuss any issues which we are required to draw to your attention. During the meeting we will provide detailed legal advice regarding the security documents. Only the person receiving the advice and the solicitor providing the advice will be permitted for the meeting. Another person is not permitted to be present as we need to ensure the advice is independent and you are not being forced, pressured or influenced to sign the security documents.
Does a Solicitors Certificate provide financial advice?
No. A Solicitors Certificate does not provide advice on the viability of a transaction in which the borrower is undertaking. Your solicitor cannot comment on the borrower’s ability to make the required payments to the lender, or a guarantor’s ability to make payment to the lender. We strongly recommend always seeking financial advice before signing security documents.
Get in touch
If you need a Solicitor's Certificate contact Allegiant Lawyers by sending us an email to admin@allegiantlawyers.com.au or by giving us a call at 02 9518 3853.
Solicitor Certificates
What is a Solicitor Certificate for a Limited Recourse Borrowing Arrangement loan?
These days most SMSF lenders require the borrower to obtain independent legal advice on the loan documents before a loan is disbursed. This usually entails requiring a borrower to obtain a Solicitor Certificate of independent advice. This a method of demonstrating to the lender that the potential guarantor does indeed know and understand what they are guaranteeing in the laon, that they have the capacity to guarantee the loan and that the potential guarantor understands the legal consequences of agreeing to guarantee the loan.
Put simply, a solicitor’s certificate reflects that the lender understands their responsibility to guarantee the loan.
History of Guarantee Advice
While a “solicitor certificate” or “guarantee advice” may seem like a simple exercise of witnessing a signature, it is not. Indeed, the rationale behind solicitor’s guarantee certificates finds itself in High Court judgments dating back to the 1980’s.
The requirement for guarantee advice/solicitor certificates came about after the High Court case of Commercial Bank of Australia Ltd v Amadio.
In Amadio the High Court concerned itself with a situation where Mr and Mrs Amadio were the guarantors for their son’s loan. The son defaulted on the loan and the parents, as guarantors, were required to secure the loan. Mr and Mrs Amadio argued that they did not understand the nature of the guarantee when they agreed to be guarantors and as a result were not liable to secure the loan. The High Court was sympathetic to this argument and determined the matter in Mr and Mrs Amadio’s favour. In principle, the guarantors were absolved of their liability to guarantee the loan.
What is the process of providing this advice?
The granting of a solicitor’s certificate is not a simple exercise of witnessing a guarantor’s signature. It requires us to ensure that a potential guarantor has read all the documents pertaining to his/her guarantee and understands the legal consequences of agreeing to be a guarantor. Oftentimes, the consequences of guaranteeing a loan can be serious and it is our job to ensure that any potential guarantor understands those consequences of entering into a limited recourse borrowing arrangement.
At Allegiant Lawyers, we will provide a solicitor certificate after we review your documents, meet with you and provide you with tailored advice on your loan.
Learn More about Solicitor Certificates
Allegiant Lawyers is here to help. If you require a Solicitor Certificate for entering into your SMSF loan, please contact us
Setting up your SMSF
The setting up process
To set up your Self-Managed Superfund, several processes are required to comply with Superannuation legislation. The setup process involves:
1. Deciding who will be members and trustees of the SMSF
2. Setting up a Company to be a Trustee (this is recommended as opposed to individual trustees.
3. Establishing your SMSF
We will provide you with the necessary legal documentation to establish your self managed super fund and will arrange for you to meet us and execute these documents.
4. When the ATO confirms establishment of your SMSF, you will be notified that your SMSF has been established .
5. Opening an SMSF bank account
You may choose any bank to open a SMSF bank deposit account. A deposit account is used to receive rollovers, contributions, and investment earnings and to cover fund expenses (such as taxes and accounting fees) and to make investment purchasers. Trustees of a SMSF must keep money and other assets of the super fund separate from their personal assets. As such is it essential that a deposit account for your fund is opened.
6. Rollover your existing superannuation into your SMSF
After establishment of your SMSF, you may rollover your already existing superannuation to your new SMSF.
7. Setup your SMSF Share Trading Account
This is step is optional. You may setup a trading account with any online brokerage firm. This account is necessary if you want to purchase and sell shares and other securities.
8. Start Investing
After you have deposited the rollover cheque into your SMSF’s bank account you can start investing.
