Water Leaks – Owner Builders Watch

I bet you did not know that according to Chubb Insurance1
water leaks are more expensive than fire and theft when it comes to claims rectification.

Out of sight – out of mind.

When building or renovating taking notice of pipes and hoses
is the last thing you as the Owner Builder are worried about.

However, internal water damage can be more costly to fix and
depending on where the leak is, difficult to find and can cause long term
damage. Most home insurance policies will not cover the leak because they
consider it to be part of the building process.

They may even consider the leak to be a defect or a
maintenance issue, that you should have been aware of, flexi hosing is a risk
and its potential failure you should have been aware.

Solution, you should consider is a shut off device
that can be installed by a plumber.  This
will limit the amount of water that if a burst pipe or flexi hose escapes into
your home, it could even save you money on your Home and Contents Policy after
finishing building.

1Chubb Get Smart about Water Leaks

The post Water Leaks – Owner Builders Watch appeared first on Australian Owner Builders.

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How to get a home mortgage after losing your home | Amy Beattie, Good Green Home Loans

How do you get a home mortgage after losing your home and without income proof?

For many who suffer the loss of a home due to bushfire, they may also lose their jobs or be unable to work.

This can make rebuilding especially challenging – especially if their insurance settlement has paid out their mortgage and getting finance proves difficult.

Learn more as Amy Beattie, Mortgage Broker, explains what options might be available to those in this position.

In this video, I speak with Amy Beattie, Mortgage Broker and owner of Good Green Home Loans.

This is part 6 of my conversation with Amy. You can watch the other parts here:Part 1 | Part 2 | Part 3 | Part 4 | Part 5

Good Green Home Loans is here to help you find the right home loan at a great rate – using only environmentally responsible lenders who aren’t using their profit and power to support the fossil fuel industry.

In this video, I asked Amy this question:

“One of the challenges that occurred for homeowners in 2009 Victorian fires was that the insurance settlements they received were actually full payouts of mortgages.

And so then they were left without a mortgage, no income due to not being able to work, or the fire destroying their business as well, and then no ability to secure finance.

What options might there be for people dealing with this now, or what alternatives there are for people?”

So let’s dive in.

INTERVIEW TRANSCRIPTAmelia Lee + Amy Beattie (Good Green Home Loans)

[Amelia Lee]: Now in terms of understanding the position that some people are in after the bushfires, I know from the research I’ve been doing with the 2009 Victorian fires that one of the big problems when it came to people losing their properties or suffering significant damage was that their insurance payouts ended actually just being that they had their mortgages paid out in full.

And speaking to people who were there at that time and working with people on the ground, this ended up being a big problem for people because, whilst it seemed great to get your mortgage paid out, if you were then with no house, your block of land, you might have lost your business, lost your job, and didn’t have then a reliable income, no bank was going to lend you money to be able to then turn around and build your new property. And you’ve got no cash from your insurance company to get started either.

So how have you seen, or have you seen that this situation might be handled slightly differently in the current environment?

Or what options there might be for people in terms of other avenues and other … I don’t know. I mean, it’s such a tricky thing, and I’m not sure if there is anything. But I suppose we’ve got … Whether there’s any alternatives for people in terms of exploring this with financing and how they explore it for their project?

[Amy Beattie]: Well, when you’re talking about hypothetical situations where this hasn’t happened yet, but people are trying to mitigate for it … For me, it all comes back to understanding the risks yourself, not just trying to meet the criteria of the bank, but understanding the risk criteria yourself. And, sadly, it’s the insurance industry that we’re all kind of hinged on.

But the importance of … We pay a fortune to insure our cars, and in the scheme of things, what we’re insuring there is so minor in our overall financial position. And we’re very … I don’t know the statistics on it, but I just know from my experience that many people are not insured adequately, personally, whether it’s their income, or their property, or their life. And most people don’t really understand the fine print of their insurance policies.

So that’s what it comes around to for me when we’re talking about hypothetically, and before you’ve embarked on taking out a home loan for your dream home, is the ‘what if this happened, and what would I do about it?’ And if the answer is ‘I’d be in big trouble’, you need to mitigate that risk somehow. And I can’t express that more. But it’s always a balance of how much that costs to the likelihood of it occurring.

But I guess in hindsight you would never say ‘I wish I didn’t have that insurance policy’ when you needed it. So for those people that are in situations like that, where their insurance was inadequate, whatever the insurance was, whether it was those personal insurances or the building insurance…The industry itself, I haven’t seen anything really yet in terms of the industry as a whole finance industry, as a whole, wanting to address how we’re going to help people like that.

So I probably … The only thing I can suggest is that you’ve got to sooner rather than later find someone that you can trust and who has your best interests at heart to go to and begin the journey of trying to find out how to get back on your feet. So whether that’s financial counseling services, and probably a really good place to start. But a broker would be a good place to start too. A broker with a really good heart would be key.

Because they will… They’ll almost certainly be banks that are willing to lend money to the people who are desperate to turn their circumstances around, but it will very likely be at a cost as well, a significant cost. And, you know, potentially lining somebody’s pockets when that isn’t the right answer. So, yes, you just got to be really wary of the not so good people out there too, I think. You’ve got to find someone you can trust and who you know cares. And yes the financial counselling services I think would be the best place to start.

[Amelia Lee]: That’s fantastic advice Amy. I think that that thing of actually just getting people who do care in your corner can make such a critical difference to you getting the right information that you need. Because often times, you’re being sort of forced to make decisions very quickly by those that don’t necessarily have the best intentions.

And so it is that… Having the wherewithal to say ‘no, stop, I just need to find these things out and make sure that I’m protected’ so that you don’t get yourself backed into a corner unnecessarily.

And I think it’s always really interesting to see when you do speak to a broker, there’s been times where we were doing projects, and we thought it was going to be impossible to access funds, but when we sat down and actually sort of laid out all of the puzzle pieces that we were dealing with, then there was always an avenue through. It just required understanding ‘okay, we might have to wait to satisfy X, or that might mean that we could do this as an alternative’.

And it is… You can’t actually make those decisions until you’ve got all of the information. So it’s lovely to know that there’re brokers like you who can help people really lay out that picture for themselves.

And a lot of the other guests that we’ve been bringing on as part of this Rebuild + Build Better series who can share knowledge and expertise with people to help them make informed decisions rather than getting pushed into something that they don’t want to do and then getting stuck.

[Amy Beattie]: Yes, and one thing that came to mind when you were saying that is just that … In my role, I often feel like culturally we … clients on the other side of the desk, they get excited by the ‘yes’. And it isn’t necessarily the best thing. So it’s just doing things in a really considered, well thought out way, speaking to many people, and definitely not relying on the wrong people, I guess.

And that can sometimes be people with great intentions that, you know, ‘when I went and saw my broker, he said this, or she said this and so … You can do this’ but it’s not necessarily right for you. So, I think there has to be that trust, the integrity, the experience, and not to just sort of jump at the first thing you hear ‘yes’ to.

Because that can just be fraught with danger. So the more knowledge you can acquire before you make any big decisions on something this huge it’ll be financially almost always the biggest decision you’ll ever make will be to do with your borrowings for a home and your superannuation.

So, don’t rush decisions, just when you hear something you want to hear. Surround yourself with the right people and good people and get the best advice.

[Amelia Lee]: That’s so true. I see lots of people fall for the things that they want to hear. And yes, my approach is that often times you’ve ignored… Like when I’ve seen things go poorly for people, it’s because they ignored a raft of people who told them what they needed to hear, and they went with the person who told them what they wanted to hear and then ended up in a pickle.

And so it is that thing of trying to check the credentials, establish the criteria, really know what your priorities are personally and find alignment with experts who can support you. And do demonstrate a caring kind of invested attitude in you achieving outcomes that are going to be suitable and not cripple you financially and not get you caught out.

So yes, I can imagine it’s a huge responsibility as a broker. I saw somebody post recently in a Facebook group that their home loan … they’ve been speaking to a broker who suggested that they get a personal loan to sort out their deposit to then be able to go and get their mortgage and it was like ‘holy cow, that sounds like a recipe for disaster!’

And it’s like … Actually the conversations you have with your broker at this point are critical for you not crippling yourself financially and not getting yourself into a lot of trouble debt wise. In terms of it is that thing you must feel a huge amount of responsibility in how you advise people in this regard.

[Amy Beattie]: Yes, that’s right. And it’s a fine balance too of offending people because you sort of say ‘I don’t think this is the right idea for these reasons …’ and it might be based on transaction history on their bank account. And that can feel personal. So it’s a fine art.

I think that ultimately the client gets to choose what they do next. So this isn’t the right way to put it, you win some you lose some, but I definitely have seen clients go somewhere else and come back around eventually.

So, you know, get lots of opinions. Don’t rely on one person. And if your gut instinct is that that person is the right person, challenge that too. And just check. Check with one or two more, because it’s only going to be knowledge and personal growth and all of those things will help you go down the right path in the long run.

[Amelia Lee]: Fantastic, Amy, thank you so much. It’s been so great speaking with you and you’ve shared all of your wisdom so generously. I really appreciate it.

[Amy Beattie]: My pleasure. Thank you so much for having me Amelia. It was lovely to chat.


This interview is part of our Rebuild + Build Better series.

Be sure to stay tuned as we share more information and expertise in helping you rebuild after bushfires, or build homes more resilient to climate conditions and in bushfire prone areas.

Resources mentioned in this video:

Get in touch with Amy here >>> https://www.goodgreenhomeloans.com.au
The post How to get a home mortgage after losing your home | Amy Beattie, Good Green Home Loans appeared first on Undercover Architect.

Expert tips to get the best mortgage valuation | Amy Beattie, Good Green Home Loans

Want to hear the mortgage valuation process explained?

What do you do if your property’s zoning has changed since you purchased? 

And did you know that banks and lenders can black-mark specific postcodes which makes it difficult to access finance?

Learn more as Amy Beattie, Mortgage Broker, helps us understand.

In this video, I speak with Amy Beattie, Mortgage Broker and owner of Good Green Home Loans. 

This is part 5 of my conversation with Amy. You can watch Part 1 here and Part 2 here and Part 3 here and Part 4 here.

Good Green Home Loans is here to help you find the right home loan at a great rate – using only environmentally responsible lenders who aren’t using their profit and power to support the fossil fuel industry.

In this video, I asked Amy these questions:

Many people may have bought land some time ago that has since been given a bushfire overlay. What do you suggest they do in regards to reviewing the finance options for building a new home on that land?How do you see banks black-marking specific postcodes or areas, and on what basis?

So let’s dive in.


Amelia Lee + Amy Beattie (Good Green Home Loans)

[Amelia Lee]: In terms of, you know, what we were talking about earlier, some people may have bought land that now isn’t necessarily of the value that they might have paid for it, it might not have climbed in its value as much as they expected. It’s had the bushfire overlay.

[Amelia Lee]: They, you know, even I know some people who’ve owned land since pre 2009, when all of the rules were different. And they may or may not want to build a property on it and and now having to sort of navigate those different hoops and those different requirements than when they bought the land. what suggestions do you have for them in terms of thinking about finance and ascertaining if there’s going to be a gap

[Amelia Lee]: I suppose that just avoiding that surprise of, am I going to need extra cash to come up with? Obviously the research is one thing, is there? I mean, do you how do you suggest people sort of do that researchers of establishing value Do you have specific recommendations for people in terms of how they kind of established the value of the project?

[Amy Beattie]: You know, many banks will allow you to just order an upfront valuation without going down the finance side of the the assessment side of things at all, and they might pass that valuation cost on to you if you don’t proceed with something. And, but sometimes they don’t. And so you, you basically be wanting to go to your broker or direct to your bank and asking if they are able to do an upfront valuation for you. So you know exactly where you stand from a value point of view before you embark on your project, ultimately, so. So, so yeah, that’s that’s the short answer to that one.

[Amelia Lee]: And have you seen that scenario where people have you know, they’ve held land for some time they thought it was worth x. It’s not Sort of that, I suppose that balance and juggle of the project planning and how to obtain the finance that they ideally need to make that project happen.

[Amy Beattie]: I’m not really because it’s, you know, when it comes to property prices, the house haven’t really had many bumps, you know, in my lifetime. So, you know, land values have have been maintained for the most part historically. So these little kind of blips in values have just happened so infrequently. It’s it’s a really unknown space, I guess, and even more so now in the current climate. So it’s one of those things I guess, if, if, if you’re planning to do something with your land, you really need to be going and speaking to the experts sooner rather than later and getting valuations done.

[Amy Beattie]: Because who knows what’s gonna happen with property prices at the moment? So finding out the number and getting the answer that those upfront answers to your questions early is the best advice I can give. But no, I haven’t I haven’t seen that. I have I’ve, I’ve seen the odd, you know, off the plan purchase that’s come in and lower than was expected when, you know, the valuation was done three years before the project finished. But it’s a completely different kettle of fish. So, so no, not in relation to land. I haven’t specifically had to help somebody in that situation. Yeah, it’s gonna be more common.

[Amelia Lee]: Yes. And I suppose the only scenario that I’ve really seen it in is where a developer may have had a large subdivision, they’ve sold off early blocks to individual purchases, and then a builder may have come in and bought a, you know, section of 15 sites or something like that to do a punch of home and land packages, yet have been given a lower price per block of land as part of that deal, which is impacted the value of other sites in the development.

[Amelia Lee]: And, and so when it’s come to the point of financing, that’s then meant that there’s been a cash gap for the individual purchaser expecting that they would had better equity in the land to then be able to refinance and build the property on so it and I think to the bushfire overlay, it’s interesting to say I have not, I’m trying to think if I’ve seen any scenarios where it’s diminished the value of a property, but oftentimes those those sites that do have bushfire overlays, they, oftentimes in areas that have either great natural resources that improve the value of the property, or they’re in areas where they’re, the views are things like that, you know, maybe incredible or there’s other aspects that are Kind of prop up the value of the property.

[Amelia Lee]: And the bushfire overlay is just a constraint to deal with with construction, but not necessarily a constraint to deal with in terms of the valuation assessment. So, yeah, it’s quite interesting to say, but I think it is that thing of unless you’ve, you’re constantly saying across what are the constraints and zonings on your property, it can be a nasty surprise, when you go to the pointy end of kind of working through that project plan and finding out Hang on.

[Amelia Lee]: This wasn’t here five years ago, if you have been holding on to some land for some time, I’ve known people that have had land for a decade that they bought for, you know, peanuts or something like that. And yeah, it’s in some beautiful kind of remote location. It’s always been the plan to build a holiday shack or something. And yeah, and the area is full of holiday shacks. And unfortunately, Now none of them make code and so yeah, it’s a very tricky scenario.

[Amy Beattie]: So yeah, but again to that, like, the banks will have different rules around those things. Some banks will wipe out an area, just by Based on postcode, and there isn’t even a necessarily although maybe they weren’t provide you the reason why that postcodes wiped out. But it might be that it’s a mining area, and there’s it’s propped up by that industry, which is, you know, potentially not going to be a strong thing, you know, something that’s positive anymore. So, so speaking to a broker, who knows, with the breadth of banks that they’ve got access to that particular bank doesn’t bias based on postcode or doesn’t bias based on a particular overlay, and we’ll look at each transaction on its own merits means that with all of the banks that we’ve got to choose from, there’s very likely to be one that can help you.

[Amelia Lee]: So does that happen? Does it banks have got particular postcodes that they just won’t offer mortgages in our particular council kind of conditions that they won’t offer? Where do you say that sort of like you mentioned, the mining is there the sort of scenario That you see that happening in?

[Amy Beattie]: Well, you know, in places like the Docklands in Melbourne where there was, you know, the supply and demand factor and then also quality of builds and that type of thing meant that property prices there changed drastically, I guess from from the point of purchase for lots of people to not far down the track.

[Amy Beattie]: So, yeah, absolutely. And and all banks generally have also, most banks generally have a tool where you can go in and plug a postcode and it will spit out it, yes, we can talk to you. I know we can’t, and you don’t necessarily understand the factors behind it. And honestly, even with the mining factor, you’ll one bank will say no, and five banks will say yes, and it’s just about the risk appetite of the bank and, you know, whether they’re balancing their overall assets and what type of assets they want, and not Talking about the property assets that I’m talking about you as a client, they’re trying to boost their lending books, they might open, their postcode ranges, just simply because they want some strong borrowings overall and the postcode is one factor.

[Amy Beattie]: But if they’re borrowers with strong financial positions, the postcode doesn’t matter. So there’s, like you said at the start, there’s a cocktail of factors and, and it’s it’s dynamic, it’s changes daily. my inbox is just often emails from Bank saying we’ve changed this policy or change that policy or, you know, and there’s so much to keep abreast of and even sometimes, I won’t know what bank I can find that can help you until you come to me and present your circumstance and then I have to start doing the research for you. Because it just changes so often.

[Amelia Lee]: That’s fascinating. I’m thinking like this kind of back end, kind of Room have spreadsheets with all of this data in it, yes and knows against it and, you know, wish that it was transparently available to everybody to access because it would be it’s quite fascinating that it’s it’s not just about the risk profile of that particular area. But what the bank’s agenda might be in terms of its larger portfolio and its reporting to shareholders and its you know, balance sheets, and what it might even from a marketing position or a brand positioning want to be seen to be doing compared to another bank like that. That’s incredible.

[Amelia Lee]: It’s weird to think of all those permutations are going to impact you when you come with your individual house on an individual lot and say, Hey, I need some money. Yeah, and it’s like it’s got to fit into this kind of data stream of of yeses and noes in in one banks particular profile and portfolio. That’s just incredible.

[Amy Beattie]: Yeah, absolutely. And it’s and there are spreadsheets that exist like that. And you know, when you first approached me about taking part in the podcast, I, you know, the first thing I did was go to some of those spreadsheets and type in bushfire and the word doesn’t come up in the spreadsheets. So, you know, straight away that was saying to me, it’s not affect us specifically that the banks assess risk on, you need to dig further. And the further you dig, it all just comes back to that person’s individual circumstances and all of the different risk factors and hopefully, how many fall into the low risk category versus the high risk.

[Amelia Lee]: Yeah, it’s, it’s funny because you could get quite despondent about that and think, well, I’m never going to be able to know all of those puzzle pieces and then on the flip side, you can get quite made quite buoyant by it to go Okay, well, what I’ve got to do is just get what I can control in order, and what I can impact sorted in terms of my deposit, my knowledge, my Understanding I, you know, I had a friend for when I was at university who was a complete real estate junkie. And by the time we’d all finished uni, he’d already invested into one bedroom properties whilst we’re all spending our money on it.

[Amelia Lee]: But I’ll never forget him saying to me never send a valuer in blind amilia always be you know, fully informed about what you want that valuation to be and give them the homework you’ve done, to set them up to understand what you’re seeking to achieve. And so every time we’ve had a property valued, I’ve done a lot of that research and real estate background information and, you know, you go to your agent and get them to look at our pay data for you and, you know, all that kind of stuff. And it’s quite, it’s quite interesting because it’s such a significant asset and it’s such as in a renovation or a build is such a significant spend.

[Amelia Lee]: But so many don’t know those pieces of research to do or feel like they’re going to just have to pay for that extra information. But so much of this you can access through conversations with talented professionals who have your best interests.

[Amelia Lee]: Hot, you know, someone like you who’s can just then lay out to them. Okay, these are the risks. Can you say what you look like? I mean, at the end of the day, you’re a number to a bank. And this is what your number looks like. Yeah, what do we need to do to make your number look better and look less risky as a as a, as an option for the bank.

[Amy Beattie]: Exactly. And sadly, um, you know, with people directly affected by the bushfires. They’re not in a situation where their dream they’re dreaming about something they want in two or three years. It’s something they need help with now. So it’s, it’s not quite that simple on that side of things, but absolutely, that’s that’s exactly right. There’s, there’s so much in your control to drive the outcome. It’s just going to be a bit of time and effort and it doesn’t have to be cost.


This interview is part of our Rebuild + Build Better series.

Be sure to stay tuned as we share more information and expertise in helping you rebuild after bushfires, or build homes more resilient to climate conditions and in bushfire prone areas.

Resources mentioned in this video:

Get in touch with Amy here >>> https://www.goodgreenhomeloans.com.au/
The post Expert tips to get the best mortgage valuation | Amy Beattie, Good Green Home Loans appeared first on Undercover Architect.

Buying Land in a Bushfire Prone Area + Getting Finance | Amy Beattie, Good Green Home Loans

So you’re buying land in a bushfire prone area? Or renovating a home in a bushfire prone area? How do you get finance? 

Learn more in this video about what lenders will look at, and what you need to consider when applying for finance in your new build or renovation project.

In this video, I speak with Amy Beattie, Mortgage Broker and owner of Good Green Home Loans. 

This is part 4 of my conversation with Amy. You can watch Part 1 here and Part 2 here and Part 3 here.

Good Green Home Loans is here to help you find the right home loan at a great rate – using only environmentally responsible lenders who aren’t using their profit and power to support the fossil fuel industry.

In this video, I asked Amy these questions:

What are some of the considerations you need to make when purchasing land in a bushfire prone area, to set yourself up for better chances with your finance applications?If you’re renovating an existing home in a bushfire prone area, what will lenders look at to see if you’re viable for borrowing for your project?

So let’s dive in.


Amelia Lee + Amy Beattie (Good Green Home Loans)

[Amelia Lee]: Now, in terms of purchasing land in a bushfire prone area, what do you need to consider in terms of setting yourself up to have a better chance for with your finance? If you’re looking … This is a thing, like we’ve … The recent bushfires, there’s speculation that more land will be zoned with bushfire overlays. People might have been looking in an area previously in the last five years that might have had a bushfire overlay added to it.

It’s quite surprising some areas that are bushfire, do have a bushfire overlay. There’ll be places in suburban Sydney that might be near a thin sliver of National Park that then have a bushfire overlay on them, that becomes a big surprise during sort of people’s due diligence.

How do you suggest that they set themselves up so that financing doesn’t become a problem in that scenario?

Yes, it’s a tricky one. Because often you’re, you know, you’re looking at land and you haven’t even started to go down the path of them constructing on that land and that project itself … And if the construction project doesn’t match the land’s requirements from a building and planning perspective, then you’ve … if you’ve gone ahead and bought the land, then you can’t do what you want to have as the final project. You’re in a tricky situation so …

A very expensive caravan park, yes!

I think sometimes when I’m driving around different parts of the area that I live, I’m in Melbourne, the morning can potentially you often see fences up around blocks, and they’ve been there for a long time. And it’s like we almost got started here and then it all came to a halt.

[Amy Beattie]: So again, it’s that RESEARCH-RESEARCH-RESEARCH factor, but when it comes to buying land, it’s definitely knowing and understanding the restrictions of the Council, and all of the overlays.

And anything that you can find out, you know, even if that’s whether it’s heritage, cultural overlays, bushfire overlays, there’s many different things that can affect whether you can do what you plan to do. So it’s… take your time, don’t jump in because of the view from the land.

Yes, I guess it’s a simple… It sounds like a very simple answer, but that that’s it. You really need to be fully aware of all of the restrictions so that you can figure out whether you can work with them or not.

Yes, and I think too, it’s that thing … The bank’s going to find that out anyway, because the bank’s going to do that as part of their due diligence of valuing the land, so you might as well be ahead of the game, and know that information before you start asking for money to purchase it.

Yes, absolutely. And you know, you can’t think of them as two separate transactions. You have to really have a pretty clear idea and pretty well researched project for the build before you buy the land.

So again, that can be tricky because you’ve got a real estate agent saying, you know, ‘I’ve got three buyers looking at this, and it’s probably going to be gone tomorrow’. It’s hard, it’s impossible to say don’t get caught up in the emotion of all of that. But if you do, there’ll potentially be really significant consequences.

So take your time, there’ll be plenty of land. And there’ll be another one, trust me. I guess I probably … I say that a lot. And it does feel like sometimes I’m the person that people don’t want to hear what she has to say, because the news isn’t all just rainbows and baby animals.

Just a dream killer in your part time! It’s alright, I often feel like that too. When homeowners come to me and say ‘oh, I want to do this, and this is how much money I’ve got to spend on it’. And it’s like… Those two things are a long way from each other. And yes, you do (feel like a dream killer) …

[Amelia Lee]: But I always feel that my attitude is, and I can imagine it’s your experience too, is that even though you’re the deliverer of bad news, you know it’s news that is much better heard early, rather than another 12 or 18 months down the track when you’ve already – when you’ve invested significantly more money, effort and energy. And that it’s always possible to dream a new dream, and one that actually is true.

[Amy Beattie]: I love that.

[Amelia Lee]: And one that actually fits all of the criteria rather than just a couple. And the new dream that fits all the criteria often actually ends up being a better dream.

So for me, it’s… I see that time and time again that there’s always that horrible, demoralizing initial moment of disappointment, because there’s been so much banking on this working out. But inevitably once everything else gets into alignment, I’d say it generally always creates much better results in the long term.

The sooner you can get to that point of ripping off the band aid and finding out the bad news, the better. Better armed you are to not waste any more time.

[Amy Beattie]: Spend all your effort in the right areas or the new areas that you need to.

[Amelia Lee]: Definitely. Now in terms of looking at renovating in a bushfire prone area, obviously there’s going to be similar considerations. But with these a lot of people would have bought houses that aren’t up to code. And as part of renovating, they need to bring the entire house up to code, which may be a bigger spend than what they initially bargained for.

How do you see that relationship with the lender, the assessment of risk? And the conversation about what their spend of the project is to get the result that’s required from a code point of view, from a value point of view, all of those kinds of puzzle pieces coming together.

[Amy Beattie]: Yes, the bank still uses all … Is still assessing all of the same things. So it’s going to be about the balance between how much you spend and what you’ll have at the end, when you’ve spent that money. It’s going to be about the increase in the loan repayments and your comfortability with that. And the impact of those increased repayments on your family and your lifestyle, and is that something you want to sign up for? Or whether you have to think about walking away. There’s all the same things to consider.

It comes down to, again, speaking to the finance experts early so that they can help you work out what your potential hurdles will be. And with those hurdles, what ones you can mitigate, and want to mitigate and want to therefore pursue, or what you don’t. And when you know… Where you cut your losses.

So it’s not really too much different, to be honest. The best place to start will definitely be where you currently have your finance, because that bank is already involved in the risk, so they’ll want the property to be back to being saleable and a risk free property again. Sooner rather than later.

So they’re going … They may well … And all banks will have a level of this, where they’ll be willing to go, and able to go outside the black and white rules that they would normally be bound by, because this is already a property that they have a mortgage over and have some skin in the game. So, in that situation, you’re probably best to start with your bank because they’re more likely to have to help ultimately.

I think too … What I see is really interesting with the renovating piece, it’s almost… It’s quite different to the building new, is that there’s a bit of a chicken and egg process where you’re sort of looking at ‘okay, we’ve got this property, we’ve got this existing house, we might have X amount of equity in it. We’ve got capacity to extend our financing all things being equal to Y. That means that we’ve got this amount of money to play with in terms of renovation’.

[Amelia Lee]: Now we need to do a little bit of work in finding out ‘okay, what is the constraints on our property? And what … Invest in some consultant help to look at what does the bushfire overlay mean, what does that mean in upgrades to our house? What does that mean in terms of have what that money might bias and where that money might need to go? And then is that money then enough? And does that look like what we kind of need to get as a finished picture?’

And it can be really tricky for people because that feels like they’re actually having to spend a lot of time, and make a lot of decisions, and speak to a lot of people, and potentially pay some professional fees to get to that point of going ‘yes, okay, now we can do the thing of applying for the additional finance and hiring the architect or hiring the designer, or speaking to the builder in a more formalised sense’.

You actually have to do a fair amount of due diligence to even get to that point, particularly when you’ve got a bushfire overlay and you’re doing a renovation because different areas will see the work that you have to do to the existing house differently. And in some cases that may actually be more affordable for you to demolish the existing house and build a brand new house that meets code rather than you trying to up spec the existing house to the standard that it needs to be.

Do you see people sort of really struggling with those early stages of ‘how much work do I need to do to get to the point where I’m like… Why can’t somebody just say yes or no to me? How much work do I need to do to suss this out? When am I doing too much research and disappearing down a rabbit hole?’ You know, all of that kind of work.

[Amy Beattie]: Well, I mean, from my side of things, the conversation always starts around ‘how much can I borrow? How much will the bank lend me?’ And it’s a little bit risky sometimes to sort of just stop there and say ‘it’s this number’, only to find that the client takes that and literally runs with it, and ends up doing so much more than maybe they would if I just sort of said ‘why don’t you do your research about the cost first, and then we’ll work to that’.

So yes … I haven’t personally assisted somebody in that situation where they’ve had damage from bushfire and just needing to, or wanting to, get back to the house they had before. Or something similar or maybe something with a few nice improvements. You know, in my role it’s about talking through those … But also asking lots of questions so I can work out what type of client I’m speaking to here and whether if I tell them the number the bank is likely to say yes to they’ll just run with it and spend more than they wish they had. So it’s a balance of all those things, too.

Yes. It must be really interesting to try and assess that … Because you’re dealing with money mindsets and attitudes to money and attitudes to process and those kinds of things at the same time as…

I need a psychological exam first as well! Just to see strengths and weaknesses! So absolutely it’s multi layered, and I’m very … I become emotionally invested in the transaction with the client too. I always do. So sometimes, the more you get to know them, the more invested you are as well. But I wouldn’t, you know, I wouldn’t do it any other way.

[Amelia Lee]: Yes, that’s gorgeous. That’s the kind of broker I’d want on board too! You want somebody who’s gonna celebrate with you or commiserate with you!

[Amy Beattie]: Ride the highs and the low!

[Amelia Lee]: For sure.


This interview is part of our Rebuild + Build Better series.

Be sure to stay tuned as we share more information and expertise in helping you rebuild after bushfires, or build homes more resilient to climate conditions and in bushfire prone areas.

Resources mentioned in this video:

Get in touch with Amy here >>> https://www.goodgreenhomeloans.com.au/
The post Buying Land in a Bushfire Prone Area + Getting Finance | Amy Beattie, Good Green Home Loans appeared first on Undercover Architect.

How to Avoid a Building or Renovation Nightmare: 4 Real Life Stories

What happens when renovating or building goes wrong? And how do you avoid the 5 and 6 figure blowouts?
When we stuff up renovating or building, it rarely involves tens or hundreds of dollars. More often than not, it means thousands, tens of thousands, and sometimes hundreds of thousands of dollars extra. Do you sometimes wish you could take a renovation course to avoid your money gurgling down the drain? (Hot tip – you can take one right here!)
For many things in our lives, we can correct our mistakes. Have another go, and do better next time.
Yet, when it comes to building or renovating our family homes, most of us only do it once or twice in our lifetimes. The expense is big, the decisions are permanent, and the choices we make become the home we have to live in – good or bad.
The fear of stuffing it up, and regretting the choices make (that are screaming at us daily in our homes) is real.
Especially when you hear the horror stories. 
Here are 4 real-life renovating and building horror stories, and tips to help you avoid these situations on your project.
#1 The homeowner and her family, whose builder went into liquidation during the renovation of their home.
This family moved into an apartment to make way for the renovation of their family home.
Things were progressing well enough, until they weren’t. The builder seemed to be falling behind. Sub-contractors were complaining that they weren’t getting paid. One threatened to come and pull out all the work he had done on the project. The builder kept stalling, kept saying things were going to be fine. The owners started paying the builder’s progress claims directly to the contractors to ensure they got paid. It was increasingly become a serious mess.
The builder went into liquidation – not only on their project, but on all projects he had underway at the time. Building literally stopped overnight. The project was already running behind. So what happened next?
After hiring lawyers to deal with the insurance claim and the aggressive receiver, they still had a half-finished home and were paying rent on a unit.
It took them some time to find another builder willing to take on the project, and the new builder quoted $50,000 to rectify the previous builder’s poor quality work. As well as several hundred thousand more dollars to finish the project.
Just like that, their budget blew out by double.
Fortunately these homeowners were in a position to fund the project to completion. However, you can imagine the additional stress this has put on them, and the frustration with delays and legalities of dealing with a liquidation and insurance claim.
And whilst the builder lost his license as his company went into liquidation, he is now operating under a “Qualified Supervisor Certificate”. This means he is unable to contract directly with consumers, but can be the nominated supervisor on a residential project for someone else’s building company.
Tips to avoid this for your project:

Once a builder is on your site, terminating a contract can be difficult and onerous. So, ensure you ask LOADS of questions before you contract your builder. Questions about the history of their licenses, whether they’ve had licenses cancelled (in any capacity), and whether any of their staff have had licenses cancelled.
Be ready to manage your project diligently, or have someone do it on your behalf. This includes checking payments, seeing that paid invoices have actually been paid. Occasionally it can be worthwhile checking on presented invoices to ensure that payments are actually being made as claimed. Any good quality builder will not resent you checking in on this.
And if your preferred builder isn’t ready to start on your timeframe, question whether the alternatives are as desirable. This builder was not the preferred builder, but one that all parties (designer or owner) had not had experience with before. They chose him because he was ready to start on their timing. The job has ended up being far more delayed than if they’d waited for their preferred builder to start.

#2 The homeowners who spent money on and time with a design team for months on a proposal to convert their garage into a granny flat …
These homeowners hired a team of designers to design and document the conversion of their garage into a granny flat. When they submitted it for a Complying Development Certificate, Council reject the application because it didn’t meet planning codes, and the garage isn’t structurally sound.
They are now reviewing the agreement to determine what recourse can be taken with the design team to reclaim their fees and council application costs. And they’re looking for another designer to assist with getting the application done properly.
This has meant wasted time, money and fees on professionals who didn’t do their job well, and now have to be legally pursued for fee compensation.
Tips to avoid this for your project:

Review your consultant agreements in great detail, whilst imagining the worst-case scenario. On review, these homeowners find that their agreement is missing some key information regarding necessary due diligence during the process that would have caught this issue much earlier.
Before considering the conversion of any part of your home, or adding on (say a second storey), get structural advice as to whether its even possible. This will save you any headaches with the design process.
And also get an understanding early of your local planning laws. A simple check with your local council will often reveal some some key information for your property. Or at the very least, it will arm you with better questions when you first get your design team over to start your project.

#3 The homeowner who decided to do an owner-builder extension to save some money.
This homeowner got quotes to renovate and extend their home, but found it was well over their budget. They decided to take on the project as an owner-builder.
However, they didn’t know how to check off that work was being completed to the required standard. They moved back into the project to save some money when the first stage was finished, and turned on the plumbing. It hadn’t been sealed properly, before the walls were lined. So, the plumbing exploded, the walls and floors got damaged.
They sought quotes for a builder to rectify the damage, and finish the project. Quotes were at least another $200,000 over what they planned to spend. Unfortunately, because the whole project took longer than they anticipated, they’re nearing the end of their approval period. Getting an extension is difficult, so they’re backed into a corner to find the funds and get the project finished.
Tips to avoid this for your project:

Seriously consider whether owner-builder is a good approach for you. Many homeowners say to me “I’m really organised, do you think I could do an Owner-Builder?” However, if you don’t know what you’re organising, it won’t necessarily help that you’re organised.
Build in a contingency for any project. Things can and do go wrong, and so having some spare funds to cover it will help you manage your risk overall.
If doing an Owner-Builder project, consider hiring a building inspector, or someone who can assist with checking the work of trades, and ensuring components of work are completed to required standards. If you have no building experience, it is very difficult to know what you’re looking for in finished work.

#4 The homeowner who hired a friend to design and manage their project.
The friend got busy, didn’t attend site as regularly as originally planned.
The builder didn’t do their job well in one area, and the project started leaking and deteriorating.
THREE YEARS LATER, they’re finally taking legal action against the builder after trying every other avenue to resolve the dispute, and get the work fixed at the builder’s cost.
They’re also hiring another builder to fix the issues. More money and a huge amount of wasted time.
Tips for you to avoid in your project:

Hiring friends and family is fraught with risk in any project. I prepared this video to explain some of the issues you can face, and that you should seek to protect yourself from. Both for the sake of your project, and your friendship!
These homeowners tried to do the kind and non-legal process for three years. We can wait far too long to speak up about our dissatisfaction, and as a result the situation gets far worse. The minute there is something needing addressing, deal with it then and there. It will prevent it from becoming a much bigger issue down the track (and everyone feeling far more resentful in the process).
Document everything. Keeping track of conversations, instructions, and errors at each step of the way. You will have difficulty remembering everything, and a paper trail will assist when any further action is required in disputes.

These are but a smidgen of the horror stories I hear from homeowners reaching out to me to ask “What do we do now?”
In Undercover Architect, I’m not one for the horror stories. It’s not my normal style to share all the scary facts about building and renovating. I’d much rather help you get inspired, motivated and confident to get it right in your project – and teach you what you need to know.It is however, hard to ignore: stuff-ups in renovating and building are rarely in the $100s or $1000s. More often than not they are in the $10,000s and $100,000s. Stuff-ups that derail projects, cause financial stress and impact how and where you get to live.So how do you avoid the 5 and 6 figure blowouts? Simple. Get informed and prepared. You being a super savvy homeowner is your biggest asset – and Undercover Architect is your secret ally.
The post How to Avoid a Building or Renovation Nightmare: 4 Real Life Stories appeared first on Undercover Architect.

Important tips for Home Mortgage Loans Process | Amy Beattie, Good Green Home Loans

Want some important tips for your home mortgage loans process?

Construction loans require specific considerations, which may impact how you go about your project.

Watch the video to learn more about what is involved when financing your home renovations or new build. 

In this video, I speak with Amy Beattie, Mortgage Broker and owner of Good Green Home Loans. 

This is part 3 of my conversation with Amy. You can watch Part 1 here and Part 2 here.

Good Green Home Loans is here to help you find the right home loan at a great rate – using only environmentally responsible lenders who aren’t using their profit and power to support the fossil fuel industry.

In this video, I asked Amy what do you need to consider with financing, and reviewing construction loans for new homes or renovations.

So let’s dive in.


Amelia Lee + Amy Beattie (Good Green Home Loans)

[Amelia Lee]: When we’re looking at construction loans for new homes or for renovation projects, what do people need to consider when thinking about their finance? You’ve touched on some things already. Is there anything that might trip people up or that they might not be aware of in terms of understanding that construction loan process and how that might work for their project?

[Amy Beattie]: Yes, so for me it only comes down to one really key thing and that is lots and lots of research. And being really informed on sales, the market that you’re building in or renovating in, and current information on comparable properties and understanding what comparable properties mean.

Because, unfortunately, building to the highest standard of BAL level, again it comes back to that very first question, doesn’t necessarily translate to a property that’s more highly valued by the bank, with the method that they use for valuing properties.

But in all honesty, in terms of when you put your property on the market for sale as well, buyers don’t necessarily, or will be not necessarily willing to pay as much as you did to get it to where it is when they’re looking to buy it. And especially in the circumstances where somebody has experienced hardship, they have to sell their property for financial reasons and therefore need to sell quickly, you’re very unlikely to recover the costs.

So that’s the biggest one, it’s understanding the market early, before you’ve even begun your project, to understand what the value you’re likely to be limited to is going to be, despite what you believe your property’s valued at the end. So that’s the big one.

And when it comes to comparable, that’s things like number of bedrooms, number of bathrooms, floor size, block size, location, and quality of the work which is all of these extra things you’ve put the money into, they’re important. But a home that’s been constructed cheaply can look very nice and be sold quickly by the right agent with a wonderful wide lens camera and the gift of the gab.

So it doesn’t, like I said, it doesn’t always translate. So lots and lots of research, and I’m a spreadsheet queen. So you can only imagine when I’ve been out there looking to buy property or even dreaming about my own dream home eventually. I’ve got a spreadsheet full of comparisons. And you know, it’s not going to be necessarily your property that the bank’s value will align to, it’s going to be what sold.

So yes, that’s the big one. What else… The other thing was just that contingency side of things because if you watched an episode of Grand Designs, let alone every episode of Grand Designs, even the best laid plans are very unlikely to be perfect despite lots and lots of research, because there’s just little things that you can’t control, and that come up. There’s things you can control too.

But having spare money that is not assigned for the landscaping at the end or the fence, or the little things that you think ‘we’ll fix those up with the spare money, the contingency’, you need the contingency to be for that unknown things. And you’ve got to be really realistic about how big the contingency bucket needs to be. And I would say it needs to be nothing less than sort of that 10 to 20% realm. You would probably know better than me that that one.

[Amelia Lee]: And is there anything else that people need to consider as part of that? I know that one of the things that many people get surprised about, and I often talk to them in terms of that actual process, is that the bank needs to see their building contract. And be able to see what the payment, the progress claims are.

And in the work that I do with helping members inside my online courses, it’s really about saying to them, you need your bank to look at what those Progress Claims are, what the definitions are, and so that you’re all on the same page about what you expect to see finished on site at each of those progress claims, so they don’t get caught out with, say, Lockup Stage. And the bank has one definition for what Lockup Stage means, but the builder has another definition.

And it means that the progress claim … That the bank refuses to pay the Progress Claim until the builder has done more work, and the builder is saying ‘Well, no, this is what the Progress Claim is for and I’m not going to do more work until I get paid for that one’.

How do you navigate that process when somebody is about to go and get a construction loan, and you know that they’re needing to sign a contract with a builder and sort of pulling all that information together to give to the bank to get certainty around that?

[Amy Beattie]: Yeah. So there’s… It’s twofold I guess. The banks will, for the most part, only work with a project that is a fixed price contract. So if we’re not talking about a fixed price contract, you’re almost certainly going to find it very hard to get financed unless you’ve got lots and lots of equity.

So, fixed price contract. Your contingency, which is completely separate from the budget entirely that the bank is working with, if that’s enough to cover every progress payment, then the main thing that the bank will want to say is that when they get to a particular point of a project, sorry, a progress payment, is that that work has been done.

If you pay for the work in advance with your contingency, then the bank will refund you for the work that’s been done. So again, it comes back to that. If you’ve got the contingency, then if the bank says they won’t release the money, you can use a contingency to do that, and then be refunded by the bank so that it completely mitigates that.

But I’ve had so many conversations over the years, I’ve been writing or helping people get home loans for sort of 15 years. The amount of times that I hear at the start of a project a client’s say how much they’ve heard progress payments by the bank, it’s a nightmare and the banks just make it difficult. Ultimately it’s difficult because they don’t want you to find yourself in a position where you’ve said ‘go ahead’ to the builder, and he’s done a whole bunch of work that shouldn’t have been done yet that he’s spent money on when he shouldn’t have because that wasn’t part of the contract.

So when the bank is being really nitpicky at the start before they release any money, it’s to avoid you finding yourself in a tricky situation with the builder, like that. So yes, I think it might be tricky at the start, but if the bank is doing everything right, you won’t find yourself in that position.

[Amelia Lee]: Yes, that’s fantastic. You know, my other business Live Life Build, we talk to builder members about the importance of actually having the homeowner present the contract to their lender, and getting a letter from the lender that they’ve seen the contract, that they agreed to the progress claims, so that you’ve got that documentation up front.

Particularly when you’re working with a broker, sometimes, some brokers don’t manage the communication as well. And so that stuff can fall through the cracks. But it’s just that case of understanding and getting all your ducks in a row right up front.

Because obviously, once construction starts happening, the last thing you want to experience is delays because somebody’s not paying a progress claim, or there’s difficulty around getting money to where it needs to go. That’s when things cause real headaches. So to get… Just to spend that, obviously that extra time in those upfront stages is so crucial to things then running smoothly.

[Amy Beattie]: And talking about the things that can go wrong at the start so that you can plan for when going wrong, and be ready, I guess.

[Amelia Lee]: It’s great.


This interview is part of our Rebuild + Build Better series.

Be sure to stay tuned as we share more information and expertise in helping you rebuild after bushfires, or build homes more resilient to climate conditions and in bushfire prone areas.

Resources mentioned in this video:

Get in touch with Amy here >>> https://www.goodgreenhomeloans.com.au/
The post Important tips for Home Mortgage Loans Process | Amy Beattie, Good Green Home Loans appeared first on Undercover Architect.

Home Loan Mortgage for Bushfire Prone Areas | Amy Beattie, Good Green Home Loans

Is a home loan mortgage for bushfire prone areas any different to a home mortgage in other areas?

When renovating or building in bushfire prone areas, there are certain things to consider in proving your case to a mortgage lender. 

Amy Beattie is a mortgage broker, and can tell us more about financing your home renovations or new build.

In this video, I speak with Amy Beattie, Mortgage Broker and owner of Good Green Home Loans. This is part 2 of my conversation with Amy. You can watch Part 1 here.

Good Green Home Loans is here to help you find the right home loan at a great rate – using only environmentally responsible lenders who aren’t using their profit and power to support the fossil fuel industry.

In this video, I asked Amy these questions:

Is borrowing for properties in bushfire prone areas different to standard borrowing?What do you need to consider when understanding your risk factors for financing?

So let’s dive in.


Amelia Lee + Amy Beattie (Good Green Home Loans)

[Amelia Lee]: Are there specifics to know when it comes to financing for bushfire prone areas in terms of understanding the different BAL ratings, the Bushfire Attack Level Ratings, and what that might mean for how much money you’ll be able to access? Or what deposit you’ll have to save up in terms of the difference in how the finance, the bank, might see your risk levels? And how much they’re willing to.. What percentage of the property they’re willing to finance?

[Amy Beattie]: Yes, so the percentages of the property they’re willing to finance are definitely crucial overall when you’re in that zone of kind of 70% or 80% plus. You’ve got mortgage insurance costs that will be added to your loan, and there has to be room under that percentage that we’re talking about, for the cost of the insurance.

So 90% is probably about where the total cost of your project needs to be capped. Including a contingency of unknown bucket of money for unexpected expenses. Because then when you add on the mortgage insurance, the total loan ends up being 92%, 93%, 94%. 95% is the limit, generally speaking, for most banks. And many won’t go that high. So you really begin to reduce the different bank options you’ve got to choose from.

So 90% is definitely the top end of the total project, including contingency. And banks don’t specifically talk in terms of BAL ratings directly. So, you know, those kinds of … So the scale of the BAL rating doesn’t really matter to the bank as such.

But banks assess the overall risk of the property itself in the valuation, and that risk analysis is about seven or eight different risk factors. And generally for the risk factors, the scale is 1 to 5. Where 1 is low risk, 5 is high risk.

And the more numbers 1, 2, 3 you can have, and hopefully, the majority of the risk factors are numbers 1, 2, and 3. Then if there are numbers 4 and 5 in there that are related to bushfire, again, the bank is weighing up everything. So if they can mitigate the bushfire risk by an insurance policy that covers the bushfire risk, then they’re not going to be so hung up on those risk factors when all of the others are strong. So again, it comes back to that overall picture, definitely.

When you’re borrowing under 70%, and up to 80%, you also take out a layer of the mortgage insurance company being involved and their whole new set of policies having to be met, or their criteria having to be met. So the bank has to answer to the mortgage insurance company who says, ‘yes, we will insure this loan for you’., or ‘no, we won’t because of these things…’

And the policies of the insurers vary substantially. So, again, another reason why you need to get your mortgage broker involved early is so you can find the bank that has the mortgage insurer that has the policies that work with your particular circumstances. So it’s very complex.

[Amelia Lee]: That’s really interesting to understand those kinds of risk criteria and the different layers that the bank will assess that by. So, you know, if your property is a BAL Flame Zone, some people may think that that means that it’s going to be impossible to finance. But from the sounds of that, it sounds like it’s actually just how it sits in all the risk factors that the bank is going to assess as part of that combination.

And if you’re only borrowing, say, 70% of the property’s value, and you’ve been able to calculate that once it’s got a house on it built to flame zone, that you’ll mitigate the risk and those types of things… Am I understanding that that means that you actually stand a better chance?

[Amy Beattie]: Absolutely. So you won’t find it impossible just because you’re a BAL, the highest level of BAL risk grading. Everything else about your application will then be scrutinised. And if it’s strong on all of those other levels…

And we’re talking about if you’re wanting to build, and in order to build you need a 30-year loan term, but you’re 65 years of age… The banks, it doesn’t matter what the flame zone is, that’s not a position that the bank wants to put anyone in financially. So everything else has to be considered. But if it’s strong in all of those other factors, the flame zone won’t matter, as long as it can be insured.

[Amelia Lee]: Yes, it’s quite interesting actually, to sort of remember that this is … It’s a cocktail of different ingredients, that it’s not just okay, a blanket statement of ‘you’ve got a property with these zones on it, it’s going to be impossible. It’s like actually, if you’re committed, it’s a case of knowing that you can be financially sound in those other areas, that you can have a sufficient deposit. And yes, you’re following those avenues of…

I know, being self-employed for so long, the property purchasing that we’ve done, we’ve always had to be geared at a much lower rate than if I was employed. But that then has enabled us to be able to argue the point in terms of our ability to pay back the loan and those kinds of things and achieve the mortgage outcomes that we needed. Because we just knew the rules. We knew what we needed to do in terms of…

[Amy Beattie]: Exactly. So again, that’s what your broker’s there for. And, you know, you go to your broker and the best thing you can do, or your bank if that’s how you do it, you go directly to your bank… You literally have to put all your cards on the table, and you have to speak openly and honestly, so that the banks can do the right thing by you, knowing the full picture and assess it thoroughly.

So, you know, sometimes, as a broker, I feel like I need to sort of poke and prod to get the full picture from people because they’re nervous about saying, ‘Oh, you know, there’s this that’s complex, or there’s this that’s a bit tricky’, but the more open and frank you can be about the full picture and answer all the questions that are thrown at you, the better chance the brokers got, or you have of finding the right bank that is willing to help you out.

[Amelia Lee]: Yes, and I always found that a much easier conversation to have with a broker than with the bank manager. Because the last thing you wanted to do was throw red flags.

[Amy Beattie]: Exactly. And that’s the thing when you go to a bank manager of one bank, who has one set of rules that he has to live by with every client, the moment you say… I don’t know, ‘it’s a bushfire prone zone’, the moment he says ‘sorry, we won’t finance a project that’s in a bushfire zone’ and you’ve completely ruled them out. So if you go to a broker, you tell them everything, they can just help you go straight to the right bank that they know accepts those tricky parts of your circumstances.

[Amelia Lee]: That’s fantastic advice, Amy.


This interview is part of our Rebuild + Build Better series.

Be sure to stay tuned as we share more information and expertise in helping you rebuild after bushfires, or build homes more resilient to climate conditions and in bushfire prone areas.

Resources mentioned in this video:

Get in touch with Amy here >>> https://www.goodgreenhomeloans.com.au/#
The post Home Loan Mortgage for Bushfire Prone Areas | Amy Beattie, Good Green Home Loans appeared first on Undercover Architect.

Financing Home Renovations or New Build | Amy Beattie, Good Green Home Loans

Financing your home renovations or new build is often a necessary step in making your dream home a reality.

So how can you get home loans that are sustainable and competitive, and what do you do if your land or project is seen as risky, or in a bushfire prone area?

Amy Beattie is a mortgage broker, and can tell us more about financing your home renovations or new build.

In this interview, I speak with Amy Beattie, Mortgage Broker and owner of Good Green Home Loans.

Good Green Home Loans is here to help you find the right home loan at a great rate – using only environmentally responsible lenders who aren’t using their profit and power to support the fossil fuel industry.

In this video, I asked Amy these questions:

Do you find that by only offering home loans with lenders who don’t support the fossil fuel industry, it’s difficult to be competitive with the option you present to your clients, that they’re limited then in what they can choose from?How do you see people’s access to finance being impacted when financing riskier properties or projects in certain areas that are bushfire prone?

So let’s dive in.


Amelia Lee + Amy Beattie (Good Green Home Loans)

[Amelia Lee]: Amy, it is fantastic to have you here. I’m so excited to be introducing you to the UA community and for us to be talking about what you do and your incredible wealth of knowledge around this world. And being able to offer people insight into how they can get access to finance and the tricks around, I suppose, and the challenges to be aware of.

But also knowing that there’s options to seek financing for their home that is in more alignment with their values that they might have around the planet and lowering their environmental impact. And I just think it’s going to be super exciting to be able to chat to you.

So I wanted to dive in and just talk about that big picture business idea in terms of … Do you find that,  because your business is focusing on lenders that don’t support the fossil fuel industry, that when you’re helping homeowners that it can be tricky to be competitive with what kind of packages you can offer them for their finance? And whether they’re limited then in their access of who … You know, it’s that thing of, ‘do I go with my values or do I go with the lower cost option?’ This is a big long term commitment, is it going to … You know, all that kind of stuff. Do you find that that’s the case?

[Amy Beattie]: The short answer to the question is definitely no. It’s not at all hard to remain competitive on price. And I have coverage of a large enough sort of panel of lenders that despite the differences between them all – and there’s big differences between them all – no matter which broker you go to see, in terms of their policies and their rules and what they will and won’t finance … That, having around 20 banks to choose from gives me more than enough coverage of the little different niches that sometimes you’re presented as a mortgage broker.

So no, the short answer is definitely not. The elephant in the room at the beginning of every meeting with a new client for me is the price factor. I guess when you’re making a sustainable choice in most things in life it’s almost guaranteed it will be more expensive. But there are some things that that’s just not the case and home loans is definitely one of them.

So yes, I think most people assume they’re going to get something a little bit more expensive. But the reality is that home loan is, ultimately over its lifetime, which is 20 or 30 years sometimes, it’s a variable cost. And that means you just have to be vigilant to not just assume that the price you got back 20 years ago is still great. And the ethical banks are as competitive, sometimes more competitive, and depending on the day of the week, I guess, because they change daily!

But no, you aren’t compromising anything. And to be honest with some really complex scenarios that I have come across, I’ve sometimes felt as if I might have to say to the client ‘look, I think we’re going to have to go down the path of a big bank’. And I’ll send… I’ll recommend someone who will do that, because I won’t. But it’s never ended up being the case. So yes, the coverage is good on all levels.

[Amelia Lee]: That’s so exciting to know. Because it is that thing… I often hear from members of my community that they’ve suggested to somebody that they want to make a sustainable choice, and they’re told ‘well, that’s just going to be more expensive’.

And so you do, you sort of set yourself up to always be willing to pay more in order to pursue the things that align with your values and make a difference in a bigger way. But it’s great that __ doesn’t necessarily have to be the case in what’s going to be probably one of the biggest loans that you ever take out in your life and yes, that’s awesome.

[Amy Beattie]: It’s one of the biggest financial outlays you’ll ever make in your life.

[Amelia Lee]: Now, I’m going to dive right into financing around sites that may have specific challenges or constraints. Because there’s actually been speculation around the bushfires that happened in 2019-2020 across the last summer in Australia, that insurance companies are basically not going to insure specific postcodes, they’re going to have whiteout zones, or they’re going to make the insurance of those areas cost prohibitive, so people just won’t be able to secure insurance.

And so, in terms of also looking at finance, I wanted to say if there was similar things happening in terms of people wanting to buy or build in these specific areas that are bushfire prone. And how you might have seen this potentially impact people’s access to finance for either building or borrowing to purchase land in these areas, and financing these riskier types of properties.

[Amy Beattie]: Yes. Okay, so there’s a couple of layers to that question. But ultimately, the biggest challenge, or the number one challenge you face when you’re obtaining finance for rebuilding or buying in a particular area is that you, no matter what that area is, you have to be able to insure the building as a condition of the loan with the bank.

So if insurance isn’t at the top of your list and making sure that it’s possible to insure, there’s every chance that by the time you’re ready and need the finance for settlement, that you’ll find that you’ll be … the bank will request the building insurance, policy and Certificate of Currency in the policy documents. And all of a sudden, the whole thing comes unstuck.

So you must be able to insure the property. And if you can’t, then you’re not going to be able to obtain finance. Unless the finance that you’re after is only up to the value of the land itself, and doesn’t rely on the value of the building.

So bushfire prone areas, one element that makes … Sorry, and the second element that makes things more challenging, and actually it’s not even specific to just bushfire areas, is the construction and renovation side of things. Which, you know, it’s a common belief that you’ve got the value of the land plus the cost of the project, that equals the value of the house on completion. And it isn’t a linear equation like that for banks.

So when you add in a bushfire prone areas requirements, as far as meeting Building Standards in order to get insurance, you add cost to the project that doesn’t necessarily equate or translate to value of the completed project. And that’s the biggest challenge. Because ultimately, the banks will only lend you up to a certain percentage of the value on completion of the property, determined by the market and sales in the area of comparable properties. And then, you know, you’re adding another layer to that then, which is: regional areas with limited sales, and it’s sort of a three-pronged challenge, I guess.

You know, overall what the banks do is they assess the entire project on every level, not just the value, But the client and their financial circumstances as a whole. So that’s all of those risks, not just the bushfire side of things. And if you tick boxes and you’re strong on every other element, but then you need to borrow 95% for the project… And you know, that’s 95% of the bank’s valuation, it can still be a very strong application.

So there’s the overall big picture that comes into the equation more so than just those initial three challenges. But they’re the big place to start, it’s … researching the market, knowing what properties that are comparable, to what you’re looking to have as a completed project, are selling for currently (so within the last six months).

[Amelia Lee]: Yes, that’s great advice. And I think one of the key things that we’re always learning, whenever we sort of start to understand one of those early steps in renovating or building, that the conversation with a broker and understanding the financial kind of sums and how that all stacks up is so key to you protecting your risks.

In terms of moving forward, often people won’t have the conversation with a broker until they’re at the pointy end of needing to get the money in their hands. And then they might find out that those valuations don’t stack and they’re coming up short. And I see that happen a lot for people who might have bought the land say 12 months ago, and then are now trying to come to get the construction loan to build or renovate, and they found that the values of the land have decreased, and they don’t have as much equity in the land as they initially thought, and they’re short and cash.

And so, it is that case of … It’s always wise, I suppose, to keep abreast of what values are doing in the area. And it is like you say, the construction costs might be increased, but that doesn’t necessarily correlate to an increase in valuation of the property, because that’s a market value process. So it’s great to sort of understand those layers of the things to consider.

And I do think it’s great that you’ve highlighted too that you may have a great case in three of the criteria, but the fourth falls over or something like that. It still can be a process that you can go through in terms of your feasibility as a potential borrower to the bank.

[Amy Beattie]: That’s right. And to your point, it literally means that the early you speak to your broker, the earlier you explain your full financial circumstances, the earlier they can give you the information you need to even potentially begin to mitigate the hurdles that you might face yourself, before the time comes that you actually need the money.

So yes, definitely the broker is vital, and at the beginning! Not when it’s crunch time and all of the emotions are behind it now, because it feels like it’s about to happen. Yes, it’s a journey and you’ve got to have, you know, the time, and get that finance side of things if it’s required, because you can’t do it without it! Understood well early.

[Amelia Lee]: Yes, definitely you must have very long term relationships with people, where you sort of see them and then it might be the securing the property 12 months later. And then it might be … sort of a very long love affair with a client to get them to the end result!

[Amy Beattie]: Yes, absolutely. And sometimes I feel a little bit like I’m the doom and gloom conversation. And you know, I’m having a lot of these at the moment but, you know… People who are coming to me early, and first time homebuyers, that generation who are a lot more … Well, with climate change being something that’s so important to them compared to the generations before them … Coming to me early about these things, and you know, it’s in my nature to warn them from the start about all the things that they have to put lots of time and effort into before they can’t turn back. And they before they’ve signed a contract, or gone too far, I guess. Yes.

[Amelia Lee]: That’s fantastic. And I think, it’s that ‘forewarned is forearmed’, and if you know the steps ahead, then it’s much easier to make them without falling in the pitfalls, and without getting yourself caught out. So it’s great that you can help work with a broker to get that kind of advice and support through your journey. So yes, that’s fantastic.


This interview is part of our Rebuild + Build Better series.

Be sure to stay tuned as we share more information and expertise in helping you rebuild after bushfires, or build homes more resilient to climate conditions and in bushfire prone areas.

Resources mentioned in this video:

Get in touch with Amy here >>> https://www.goodgreenhomeloans.com.au/#
The post Financing Home Renovations or New Build | Amy Beattie, Good Green Home Loans appeared first on Undercover Architect.

Rebuilding a House After Bushfire with Prefab Modular: Callignee II with Chris Clarke

When rebuilding a house, or building a new home, modular housing, prefab, and shipping container homes can be a great alternative.

In this video, Chris Clarke, builder, went about rebuilding home Callignee II after losing his home in the Black Saturday Fires in Australia, 2009.

Later, he created SWALE Modular and now sees shipping container homes, relocatable homes and modular housing as a great alternative for rebuilding a house.

In this interview, I speak with Chris Clarke, Builder and Director of SWALE Modular.

Chris has an incredible story to share, and a lot of insights that are both practical and mindset related to really help anyone who is rebuilding or building in a bushfire prone area.

So let’s dive in.


Amelia Lee + Chris Clarke (Builder and SWALE Modular)

[Amelia Lee]: You mentioned that you know, there’d be certain things that you do a little bit differently now that you’re in a bit of a different place.

You know, we’re 11 years on from those fires, you’re living in a different environment now, Callignee II has new owners and, you know, you’ve moved on.

Knowing what you do now, how would you approach that project differently if you had to do it again.?

[Chris Clarke]: It was actually an interesting story because I’d finished Callignee II and a good friend of mine actually said ‘can you give me a hand in Vietnam?’, and flew me over there. And I went through a huge shipping container factory where you couldn’t see the other end of it.

And after two weeks, I came back and I had a glass of red and … they built these corten shipping containers and they were building these big 48 footers. And over a glass of red it dawned on me … I stepped out these 48 footers and they were the exact modules of what I’d just built.

And I thought ‘how incredibly stupid’ because I was always looking for a way to take my house with me, if I ever needed to. So obviously that started my modular whole passion, obsession. Yes, I looked at it and went ‘I could probably get this thing a hell of a lot cleaner and true for around half the price’.

[Amelia Lee]: Yes. Can we talk a bit … because obviously since Callignee II you’ve created a modular housing company called SWALE and we’re going to pop links to that in the resources for people to check that out. Because that’s your passion and it’s your business, and it’s an extraordinary adventure. And I’m super excited to be talking to you later about SWALE, because I know that a lot of people will be very, very curious about it as an alternative and a very different way of solving a lot of problems that people are facing when creating affordable homes in all sorts of environments.

Can you talk to us about SWALE … And I suppose that journey of you seeing Callignee II, the mapping of the shipping container module, knowing that people were facing challenges of building in these types of areas, and just the aspect of what modular housing can offer us as a building methodology alternative?

How has that formed SWALE and how to SWALE help people in terms of delivering homes that are sustainable and affordable, and really work for these types of environments?

[Chris Clarke]: I think the big one, actually, at the start was that there’s so much time that’s involved in replacing a home. And when you’ve actually lost your home from the fires and these poor people that are actually out there coming into winter. And you’ve still got people actually wondering what they’re going to do with planning. And you still have to go through the design. You still have to go through this whole whole process.

I really took a look at it, and I said ‘this is what I do for a living, and it’s still taking me SO long to actually open up a drawer and get the knives and forks out to be able to have a meal. So why can’t we have the knives and forks already in the drawer, and be able to drop a complete unit in place that actually ticks all the boxes?’

Why do we … why are we always re-engineering the Porsche when a lot of people can’t afford the Porsche. So I think it was that passion … and it was also the ability to … for us, because we become creative people and we actually want to build these things. These things are not just meant to be on paper.

So, it was the ability to give people something that they actually wanted, that was modular. And I used to say that it’s like driving a Porsche, and it’s like driving something that you want. And to me it was probably a kombi van, or a mini, or something like that. But you had the ability, instead of waiting two years and trying to design your way right the way through it.

And a lot of that passion for design is still there. Because we say with our modular stuff, it’s that we only provide the body. And the body actually needs to be able to be intermodal, it needs to be able to go on any ship, any truck, anywhere. And you can dress it, if you want to dress it, or just leave a percentage of what you actually want to do. Because so many people are just so worn out after the process that they don’t end up doing the beauty of the 10%, to finish their homes. That’s really the part that they can connect to, and call it their own.

So, modular still has that ability and our life in a modular world was based on, virtually, a shipping container factory where there was 2.2 tonne in 20 foot unit. And we could turn that steel work into whatever we liked. And we could get this very raw and designer look in amongst something that was intermodal, affordable and direct.

And that went, for me, it went on to then looking at places to put them, and that opens up a whole new world for me. Because it’s … you go into land sharing, and you go into being able to live on the water and our pontoons … that’s … a 20 foot high cube that’s freshly cut into six. And so everything again is intermodal, and then your modules go on on top of that.

And instead of spending $500,000 for a block of land, you can spend $50 a week or something rather for a marina. And the same with land sharing. Why are we paying $500,000 for a block of land instead of $50,000 for 10 people on a half a million dollar piece of land? It’s just insane.

So it’s a really great space to being amongst, especially now when we say that people believe now in modular … I used to say that no one will buy a modular until they’re having coffee beside somebody who’s built modular! Because that’s the way that it works.

And now people have, I think, a lot of faith, and they want to be creative, and they want to do something different. And life is also changing because people are becoming more and more transient now. And our business is fast and the digital world has changed the way that we can work. And there’s not a lot of security now in jobs, and relationships, and bits and pieces. So the home really is going into a, or has the ability to go into, a different place.

So I see that as being one of the … at the forefront of my interest, it’s being able to build communities again, and sustainable communities, and eco villages. There’s some beautiful ones up the coast around your area that I’m extremely interested in.

And obviously, when you stick something that’s intermodal, you don’t necessarily need to own the land. You can actually … it can be removed within 24 hours and then falls under the Residential Tenancies Act. So that’s an interesting space.

[Amelia Lee]: Yes. When I first spoke to you about this, my brain just started singing with all of the opportunities I think that this does to solve a lot of issues around affordability, around siting, around dealing with Bushfire Attack Level ratings on properties, around strategies of where you might rebuild.

Because it is that thing of ‘can there be a chance for people to pool their resources, share property in a more effective way?’ And it requires a pretty big flipping of mindset of what is our … what we own and what our assets are.

And then also, I think that there’s an element of perhaps the compact living component, you know. I see houses, I mean, (in Australia) we’re still guilty of building some of the largest houses in the world. We still are guilty of having houses that have seven different living spaces in them, more living spaces than occupants sometimes.

And so that whole process, I think, of seeing you go through Callignee I to Callignee II, to a smaller and smaller footprint, to a smaller and smaller footprint. And this real sense of what do you actually need to live in? What is living about?

How do you see that mindset development being such a key part of you really questioning that housing can be different?

That you can not necessarily own the land that your house is sitting on. That you can own the house and take it with you.

That there’s still a permanence about your sense of home without you needing to have all of the frills that we ordinarily associate with homeownership.

How, just in terms of getting into the headspace of that … because I can imagine you’re dealing with a lot of people who are really challenging the norm of what owning a home is all about, when they come to you seeking sort of a modular solution.

[Chris Clarke]: I think that there’s some fundamentals, that’s … that we can really look at. And you’ve got to look at this very objectively. Because we look at a space and how much space that you actually really need. And how times are going to be able to change, so that we can adapt our lives.

It’s like, if you’ve got six kids and you’ve got to drive around in a bus. You’re not going to drive around in the bus for the rest of your life. So you’ll downsize that. And I think in this world to be able to build a house and be able to snap a branch off that family tree and give it to one of your kids is something that’s we all should look at designing into our lives. So there’s some really interesting spaces there.

And I think the big one for the interesting space for me, is that if you’re building something it must remain an asset. And then it very quickly flipped into liabilities if you’re not careful. And so we start looking at tiny homes and we start going ‘Okay if we’ve got a tiny home, at what point does it become a dolls house and when they no longer ready for it?’. Where’s it going to go?

But if you’re clever and designing a tiny home, it’s going to be adaptable into another person’s life or re-use or, something along those lines. Because, you know, you look at the property guys and the system is the system.

And a lot of the major property guys, you know, when they bought out the Amazon house it was extremely interesting, because I wanted to hear what the critics were going to say about it. And they said ‘Well it’s going to end up in the tip!’ Because it’s not, you know, it’s not an asset.

But yes, it is an asset. And it’s going to be somebody’s home. And because it’s not connected to a parcel of land, you’re not just holding the value on the land, you need to hold the value in the part that’s actually going to look after you. Because it’s the one sheltering you from the rain. And the land is firstly just a manipulative tool. And if you go in looking at the process a little bit differently, and you look at it from an indigenous point of view, it’s like nobody owns the land anyway.

So there’s some huge processes to break, I think, along the way. But I think now, especially with COVID-19 and whatnot, I think we’re going to actually start to find a few more openings, and start working with some people that want to be more creative and work together.


This interview is part of our Rebuild + Build Better series.

Be sure to stay tuned as we share more information and expertise in helping you rebuild after bushfires, or build homes more resilient to climate conditions and in bushfire prone areas.

Resources mentioned in this video:


Grand Designs | Season 1, Episode 1 >>> WATCH THE EPISODE HERE

Swale Links and Resourceshttp://www.swale.com.au/http://www.dakinihideaways.com.au/https://www.facebook.com/SwaleModularCommunityhttps://www.realestate.com.au/lifestyle/transportable-modular-boat-house-on-pontoon/

Callignee Links and Resourceshttp://www.swalehomes.com.au/callignee-ii.htmlhttps://gippslandia.com.au/forged-in-the-fire/https://www.architectureanddesign.com.au/projects/houses/calignee-ii#
The post Rebuilding a House After Bushfire with Prefab Modular: Callignee II with Chris Clarke appeared first on Undercover Architect.

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