Mine Subsidence Home Loan

Buying a property in a mining area comes with unique challenges, but it doesn’t have to mean an automatic “no” from the banks. While some lenders view mine subsidence as a high-risk factor, others are comfortable lending if the right protections and certificates are in place.

What Are Mine Subsidence Districts?

Mine Subsidence Districts are areas that may be affected by ground movement resulting from underground mining, particularly coal mining. Structures within these districts must comply with building guidelines to withstand ground movement.

These controls are overseen and implemented by the Mine Subsidence Board (MSB). When buying a property, the purchaser is notified that they are buying in a Mine Subsidence District at the time of purchase.

How Much Can I Borrow For A Mine Subsidence Mortgage?

• You can borrow up to 95% of the purchase price with some lenders or up to 100% by using a guarantor.
• You will need to provide a Mine Subsidence Board (MSB) certificate prior to loan approval.
• The bank valuer must recommend the property as suitable security for a mortgage.
• All loans are assessed on a case-by-case basis.

In many cases, the valuer for one lender will make comments in their report that results in your loan being declined.

We can order valuations with other banks and confirm which lenders will approve your mortgage!

If you want to purchase a home in a mine subsidence district, contact our expert mortgage brokers on 1300 889 743 or enquire online.

How Lenders Assess Risk In Mine Subsidence Areas

If you buy in an area that is near a mine subsidence district, or is not on top of an old mine, then it is accepted as a normal security. As a result, you will be able to borrow up to 95% of the property value.

The major concern for lenders is the properties built very close to or even on top of old mines.

They could potentially have huge pockets of unfilled land beneath so the banks rely heavily on valuers’ comments to determine how much you can borrow.

If the property is close to an area within the Mine Subsidence District known to have issues, then the banks can restrict the LVR as the risk gets higher and the property gets closer to the mines.

The best way to find out whether your property is at risk is to be informed and contact a local valuer.

The risk is not only to the bank but to you as the buyer – the last thing anyone wants is to have the family home collapse.

Buying In A Mine Subsidence District

If you are purchasing a property in a Mine Subsidence District, your lender needs to know the home is eligible for compensation if the ground shifts. In the past, this was confirmed with an MSB Certificate. While these are no longer issued, the protection process has changed.

As of late 2019, the Mine Subsidence Board (now Subsidence Advisory NSW) stopped issuing new Section 15B and 15C certificates. Because banks often use older checklists, they may still ask you for these documents.

We help you navigate these banking requirements by providing the modern alternatives lenders now accept:

• The Historical Register: If the home was built before 2019, we can search the online register for an original 15B certificate. Most banks accept these legacy documents for older homes.
• Compliance with Guidelines: For newer homes, eligibility for compensation is usually automatic. Providing the lender with a Council Occupation Certificate confirms that the home was built in accordance with the required development guidelines.
• Pre-Mining Inspections (PMI): In active mining zones, a PMI report is now the standard way to protect your eligibility for future claims. Many lenders now request this report as part of the financing process.
• Contract Disclosures: Instead of a 15C certificate, your solicitor will check the sales contract for any previous claim history or compensation payments.

How Do I Select The Right Property While Buying In A Mine Subsidence District?

There are three things you should do when buying in a mine subsidence district.

• Speak to a local real estate agent: Local real estate agents have a good understanding of the local area. They would know if there were issues with past borrowers when trying to finance a property.
• Get a valuation report: If you are unsure whether a property is impacted by mine subsidence then get a local valuer to assess the property. A valuer will know the area well, is able to contact the local council about each Mine Subsidence District and can provide an unbiased report.
• Put an extended finance clause in place: A finance clause provides the banks with more time in case the property has to go to a credit or mortgage insurer. An extended finance clause is longer than a normal finance clause. It allows up to 10 days instead of 5 days.

Can I Cover My House For Mine Subsidence Damage?

Any surface improvements that the Mine Subsidence Board authorises are protected by the Mine Subsidence Act of 1961.

This means, that any damage to authorised improvements as a result of mine subsidence is covered by the Board, which is funded by a levy on the New South Wales mining industry.

If a building was constructed before the Mining Subsidence District was declared, or the building is outside of the district, then you are automatically covered for mine subsidence damage.

It can be difficult to get cover from insurers for certain properties in a mine subsidence district.

Details that you will need to supply to the Board

All applications to the Board must include the following property details

• Lot or portion size
• Deposited plan: The legal boundaries of the land. This is often a record of subdivisions, easements, and resumptions.
• Mining Subsidence District section number (if applicable)
• House number
• Street and suburb

List Of Proclaimed Mine Subsidence Districts In NSW

Any areas that are mining towns or have older mines within the area can be affected by mine subsidence. Areas within NSW include:

• Appin
• Bargo
• East Maitland
• Hue Hue
• Killingworth / Wallsend
• Lake Macquarie & extension
• Lithgow
• Mitchells flat
• Muswellbrook
• Newcastle
• Patrick Plains
• South Campbelltown
• Swansea North Entrance & Extension
• West Lake
• Wilton
• Mandalong
• Wyong
• Picton
• Tomalpin
• Some parts of Newcastle City Central

Talk To An Expert

Most banks get jumpy about mine subsidence, but our brokers know which ones are fine with it. We’ll find you a lender that understands the area so you can get your finances sorted without the runaround.

Call us on 1300 889 743 or complete our free online assessment form to speak with one of our mortgage brokers.