Ring-shaped structural maintenance of chromosomes (SMC) complexes like condensin and cohesin extrude loops of DNA. It remains, however, unclear how they can extrude DNA loops in chromatin that is bound with proteins. Here, we use in vitro single-molecule visualization to show that nucleosomes, RNA polymerase, and dCas9 pose virtually no barrier to loop extrusion by yeast condensin. We find that even DNA-bound nanoparticles as large as 200 nm, much bigger than the SMC ring size, also translocate into DNA loops during extrusion by condensin and cohesin. This even occurs for a single-chain version of cohesin in which the ring-forming subunits are covalently linked and cannot open to entrap DNA. The data show that SMC-driven loop extrusion has surprisingly little difficulty in accommodating large roadblocks into the loop. The findings also show that the extruded DNA does not pass through the SMC ring (pseudo)topologically, hence pointing to a nontopological mechanism for DNA loop extrusion.