Macquarie Bank freezes trust lending: What investors must know

In this episode of The Smart Property Investment Show, host Emilie Lauer is joined by Eva Loisance from Finni Mortgages to discuss Macquarie Bank's recent freeze on lending to trusts and companies and its impact on property investors.

They explore how trusts and company structures have become increasingly popular, even among first-time investors, due to perceived benefits such as asset protection, tax advantages, and the ability to bypass traditional lending limits.

Loisance explains that while these strategies can enable portfolio growth, they carry significant risks, especially in a high-interest, low-yield environment where properties may not be positively geared.

The discussion highlights concerns about aggressive lending strategies promoted on social media and the potential for overextension, which partly motivated Macquarie's decision.

Lauer and Loisance emphasise that while the freeze affects investors relying on trusts, it may also lead other banks to tighten lending scrutiny and standards.

They stress the importance of reassessing investment strategies, seeking professional advice, and focusing on sustainable, positively geared properties. Despite the challenges, trusts remain as viable options for well-informed investors who engage accountants, financial planners, and brokers to guide decisions. If you like this episode, show your support by rating us or leaving a review on Apple Podcasts and by following Smart Property Investment on social media: Facebook, X (formerly Twitter) and LinkedIn. If you would like to get in touch with our team, email editor@smartpropertyinvestment.com.au for more insights, or hear your voice on the show by recording a question below.