Products & platforms

Macquarie 100% Investment Loan

This product is closed

 

Features

Invest with no upfront capital

The Macquarie 100% Investment Loan gives your clients access to unique investment opportunities without having to contribute any upfront capital. Macquarie will lend your clients up to 100 per cent of their investment amount - and the investment is the only security required for the loan. Principal is only repayable at maturity, in certain circumstances, including if Macquarie terminates the loan facility, or if you are in default.

Your clients can however make loan repayments at any time they wish, except where the interest rate is fixed.

Your clients have a choice of interest rates and payment options

Choose from variable or fixed interest rates, payable monthly in arrears, or annually in advance.

Your clients can borrow the prepayment of interest

If your clients elect to fix the interest rate, they have the ability to borrow the interest prepayment amount through an Interest Prepayment Loan.

Your clients may benefit from potential tax efficiencies

This will depend on the specifics of the investment they purchase with the loan funds, as well as their own personal taxation circumstances.

Risks

Key risks of the Macquarie 100% Investment Loan include:

  • Borrowing to invest - in order for you to break even at maturity, your units in the Underlying Investment acquired with a Macquarie 100% Investment Loan will need to have produced income and growth in excess of your interest payments and other costs (excluding taxation considerations and the time value of money)
  • Full Recourse Borrowing - You are obliged to make ongoing interest payments and pay the Macquarie 100% Investment Loan repayment at maturity and repay the Interest Prepayment Loan (if applicable), regardless of the performance, level of distributios or the return on any investment in units in the Underlying Investment
  • Early Unwind or Repayment of your Macquarie 100% Investment Loan - your Macquarie 100% Investment Loan and Interest Prepayment Loan will become immediately repayable in certain circumstances including if you decide to exit your Underlying Investment prior to maturity
  • Illiquid Underlying Investment - additional considerations apply if you take out a Macquarie 100% Investment Loan and Interest Payment Loan to invest in an Underlying Investment which is designed to be held to maturity or is illiquid
  • The Macquarie 100% Investment Loan brochure sets out further information about risks. You should read the brochure (and any updates) before making an investment decision.

Frequently asked questions

Are the terms of the Macquarie 100% Investment Loan the same for all the various underlying investments?

The loan structure is the same for all underlying investments - that is, Macquarie provides 100 per cent finance and, until maturity or the occurrence of an event of default or certain other early termination events, the borrower makes interest payments only. However, the interest payment options available, fees and minimum loan amounts may vary depending on the underlying investment. Therefore, it is important your clients refer to the investment specific term sheet for information relevant to their underlying investment.

Why does Macquarie ask for a Statement of Position (SOP) if the underlying investment is protected?

As the 100 per cent Investment Loan is full recourse, we require that all applicants complete a SOP and provide income verification documentation where the loan application or existing Macquarie investment loans exceed $150,000. Applicants who apply for or already have Macquarie investment loans in excess of $300,000 must also provide verification of assets.

Is the Interest Prepayment Loan available with the Macquarie 100% Investment Loan?

If your clients elect to fix and prepay the interest on your clients Macquarie 100% Investment Loan, your clients can apply for an Interest Prepayment Loan in June of each year to fund up to 12 months interest prepayment on their loan.

What information will I receive during the term of my investment?

During the term of your client’s investment, they will receive statements twice a year containing their loan balance, a summary of their portfolio and an itemised record of any transactions, including interest.

Your clients can also view their loan and portfolio information 24/7 on GearUp, our secure client service website.

What happens at the end of the loan term?

Your client’s loan term will be the same as the term of their underlying investment. They will be contacted prior to the maturity of your Underlying Investment and Loan and given choices regarding how you want to repay your loan. This can include repaying the loan out of their own funds and retaining the underlying investment, or asking Macquarie to redeem your capital protected investment on their behalf and applying the funds to repay the loan principal at maturity.

What happens if your clients want to exit the investment early?

If your clients decide to exit their investment prior to the maturity date, your clients will have to contact the Account Management Team for an unwind quote. The unwind quote may include a number of exit fees payable to both Macquarie for the loan and the Investment Manager for your clients Underlying Investment. Please refer to page ten of the Macquarie 100% Investment Loan brochure.

 

Contact us

Call: 1800 080 033

Overseas: +61 2 8245 4903

Fax: +61 2 8232 6158

Email