Mortgage Mastery: Insights From A Mortgage Broker On Home And Renovation Lending
Organise + design your Reno with these resources
Looking to purchase your dream home, an investment property, renovate or refinance your home?
Having bought, sold, renovated and developed property for 20 years, I know firsthand that the right mortgage for your unique circumstances can save you TIME and MONEY… and BIG TIME. #yesway
So, I got in touch with my good friend, Katherine Persoglia, owner of boutique mortgage broking firm Property Before Prada, to pick her brains and get the inside scoop on everything mortgages and refinancing. Katherine has years of experience helping individuals demystify the lending process + break into the property market… but what I love best of all is her down-to-earth, honest and straight-up approach to lending without the usual bank jargon. Katherine also recently completed her own stunning Hamptons Style home-building project in Brighton, Victoria — Hamptons on Norwood, and I was lucky enough to get a home tour.
Ready to get mortgage-savvy? Here are Katherine’s top tips and tricks for selecting + paying down a mortgage, and her own home-building experience with knowledge she has learned along the way.
Property Before Prada • Hamptons Kitchen Island Bench Design
Hamptons on Norwood Details
Name: Hamptons on Norwood - Residential Home
Location: Brighton, Victoria
Project Duration: 15 months
Hamptons on Norwood is a coastal-style home in Melbourne, with traditional Hamptons elements such as profiled cabinetry, wall panelling and external stone wall features. The new build was a labour of love for the owner, Katherine, having completed the entire construction phase during Covid-19 restrictions.
Before that, Katherine’s new Hamptons home build was in the planning phase for two and a half years, which included seeking council approvals and working closely with an Interior Designer. The irregular-shaped block called for a bespoke design that was brought to life by her builder’s in-house Architect and Draftsman, which includes a resort-style pool and undercover alfresco lounge area.
Property Before Prada • Hamptons Alfresco Living Area Pool Design
Property Before Prada • White Hamptons Kitchen Design with Pendant Light
Why Property Before Prada?
Katherine’s passion for property began when she started her own property portfolio at just nineteen years old. She never looked back, and soon realised that “Property Before Prada” and investing in the property market at an early age, was the key to financial freedom.
Katherine quickly found her niche in the mortgage broker space where she could share her property expertise and also give back at the same time. Her twenty-one years of experience allow her to help clients navigate their way through confusing financial information to empower them to begin their own property portfolios. Below are some of Katherine’s top tips on choosing and paying a mortgage, as well as using equity to fund home renovations.
Property Before Prada • Hamptons Living Room with White VJ Panelling
Katherine’s Top 5 Considerations When Choosing a Mortgage
Your Property Goals: Understand your short, medium and long-term property goals before taking the plunge. If you plan to sell your property quickly or flip it, consider selecting a variable-rate loan with no lock-in periods.
Budget + Cashflow: Assess your lifestyle and financial situation to choose between the stable monthly repayment of a fixed-rate mortgage versus a variable that may help you reduce the interest you’re charged on your loan.
More Than Just a Rate: It’s important to consider not only the interest rate but all aspects of a potential new mortgage, including the right bank and policies to support your unique journey, goals and objectives.
Additional Repayments: For owner-occupied properties, making additional repayments each month and budgeting to pay your mortgage on a fortnightly basis can save years on your mortgage term and thousands of dollars in interest charges.
Leverage $$$: If you can afford to borrow, leverage as much as you can to invest and build wealth. Remember, cash is king.
Property Before Prada • Hamptons Bedroom with Light Grey VJ Wall Panelling
Property Before Prada • Hamptons Facade Soft Pink Door Design
Advice For Paying Down a Mortgage Faster?
Regular Fortnightly Repayments: Making regular fortnightly payments can be of great help and save you over three years off your mortgage and almost $60,000 in interest. For instance, if you have a loan of 400k, increasing your fortnightly repayment by $50 can make a significant difference.
Refinance/Renegotiate: A simple phone call can save you thousands of dollars. If your bank is not willing to lower your interest rate, then contact your mortgage broker and see if they can get you a better deal — but remember to avoid extending your loan back to 30 years!
Additional Repayments: Making additional lump sum repayments throughout the year can also help you pay off your home loan faster.
Property Before Prada • Hamptons Bedroom Design with Light Rattan Pendant Lights
Big Banks Or Small Lenders?
One of the biggest factors in the mortgage process is choosing your lender. Katherine advises that every lender has a unique niche with varying policies and strengths. Smaller lenders often provide excellent rates and products, however they may have more conservative lending criteria.
Choosing the right lender really comes down to working with a broker who understands your needs and objectives so they can align you with the right lender to support you and your big picture.
Property Before Prada • Hamptons Outdoor Shower Design
Property Before Prada • Hamptons Staircase Design with Statement Pendants
Using Equity For Home Renovations
A great way to upgrade your home without using your own savings is to access your home equity to fund home renovations or extensions. Katherine adds, “What's crucial here is your property valuation, LVR (Loan to Value Ratio), as well as understanding a bank's policies on how you can access your equity.”
Some banks may limit how much money you can access for renovations — which could be as little as $50,000 or restrict renovation lending to non-structural improvements, while other lenders are far more flexible. Be sure to chat with your broker for proper equity guidance and make clear any plans for renovations or property improvements to avoid surprises.
Property Before Prada • Hamptons Bathroom with White Subway Tiles
Property Before Prada • Hamptons Hallway Console Table Styling
Financing For Home Building: Top Tips
Understand your financial situation: Understand your borrowing capacity, loan amount, and monthly repayments, and make sure you have contingency funds for potential cost overruns and building variations.
Building Contract: Be aware that valuers will note any changes made to the building contract, and your lender will require funds upfront to cover the cost of any significant items removed from the contract. Check with your lender if they accept large omissions from the contract, as the house generally needs to be habitable and complete for funds to be released.
Careful Planning: Katherine managed to maintain a smooth and on-schedule project with the help of her Builder’s project manager. She says that patience and thorough planning are essential to ensure you stay on track and organised throughout your home-building project.
Property Before Prada • Hamptons Media Room Design with Herringbone Flooring
Property Before Prada • Hamptons Ensuite Design with Marble Benchtop
Property Before Prada • Hamptons White Wall Moulding Details
The Team Behind The Project
Interior Design + Styling: Katherine of Property Before Prada
Builder: Carter Grange
Landscaping: The Lawn Boys
Pool Design: Bayside Pools
