Property Owner FAQ
MyBrix is an innovative solution for property finance that breaks free from outdated traditions, therefore those new to MyBrix typically have questions. In this Blog we provide answers to the Frequently Asked Questions (FAQ) for MyBrix Property Owners.
1. Are there really No Interest and No Repayments?
Yes, once your property is fully funded there is no interest charged and no repayments required, regardless of the amount funded, as long as you are over the minimum equity limits of 35% for Owner Occupied Properties and 30% for Rental Properties. We do, however, encourage you to re-acquire Brix from Investors to create more Brix equity in your property throughout the term of your MyBrix facility.
2. What is a Brix?
A property is divided into 10,000 Brix, and each Brix represents a piece of the future sale proceeds and rental proceeds of the property. If your home has a market valuation of $1,000,000, then each Brix would be worth $100. Over time as the market value of the property increases so does the market value of Brix.
3. What is an IBO?
In MyBrix an IBO stands for Initial Brix Offer, which is the process for listing a new property on the MyBrix platform. Investors are incentivised to participate in a property’s IBO by the attractiveness of the property and the discounting of Brix which is ascertained through the Property Assessment process.
4. What is the maximum term of a MyBrix Facility?
The Maximum term you can have a MyBrix facility is 10 years from settlement.
5. What is the maximum amount I can Fund?
The Maximum you can fund is 65% for Owner Occupied Properties and 70% for Rental Properties using Standard or Silver Brix. In addition, you can fund up to 90% by filling the gap with Gold Brix. Gold Brix are subject to different terms and conditions and have mandatory monthly buybacks over 5 years.
6. Do I have to pay off my existing Mortgage?
Yes, MyBrix will pay out your existing bank mortgage with your bank as part of the conveyancing process once your property has been fully funded.
7. Does MyBrix have a mortgage on my Property?
Yes, MyBrix will place a first ranking mortgage on your property on behalf of all Brix Investors. Only at the completion of the MyBrix funding term or when you sell your property, will MyBrix remove the mortgage.
8. What fees does MyBrix Charge?
We have a simple fee structure that builds up as you decide to move through each phase of your funding journey. Our Fees include a Property Assessment Fees, a Property Listing Fee, as well as a Property Funding Fee. These are once-off fees paid at each stage. MyBrix also holds 2.5% of all Brix in your property.
There are no ongoing fees for having a MyBrix facility, however, there will be real estate selling fees when your property is sold for you by MyBrix. All Fees are stated in our Information Disclosure Statement.
9. Does MyBrix lend Money?
No, MyBrix is not a lending platform, it is a peer-to-peer service where Investors buy Brix in your property. The Investors hold these Brix for capital gain and Brix can be bought and sold at any time on the MyBrix Trading Platform (coming in 2024).
10. Are there really no Credit Checks?
We don’t require credit checks for Standard or Silver Brix, as you are not borrowing money nor making any repayments, it is the quality of the property that is important to MyBrix Investors and why we undertake a Property Assessment as the first step in the funding process. If however, you raise additional funding by selling Gold Brix then Credit checks apply.
11. Does the price Brix sell for on the Trading Platform affect the market value of my Property?
No, the value of your property is determined by the Market, the trading platform is for investors to buy and sell Brix, they can sell at any price a purchaser is willing to buy them for, irrespective of their estimated market value.
12. Will all applications for MyBrix be Successful?
No, we expect high demand for MyBrix funding, and properties that are attractive to MyBrix Investors will be those that Investors will fund. Your Property Assessment Report will detail the attractiveness of your property to Investors as a score out of 1000, and it will also estimate the range for the market valuation and maximum funding.
13. What happens if I disagree with the Property Valuation in the Assessment Report?
It you are not happy with the initial automated valuation you can request a manual valuation (additional fees will apply). If you are still not happy this represents the actual market value of your property you can discontinue your application without further penalty, however any monies paid or owed at the time of withdrawal from the MyBrix process are unable to be refunded.
14. What happens if my property goes down in Value?
Property values go up and down all the time, but over the long term have always increased. Property values have averaged around 7% growth per annum over the last 30 years. Should the market value of your property decrease through market-based forces, the decrease is borne equally by all Brix holders.
The amount you fund through MyBrix is the minimum you need to provide to investors at sale time, if the net sale proceeds (after selling fees) is less than the amount funded you will need to provide these additional funds as part of the property settlement for MyBrix to release the mortgage.
As MyBrix has no interest, no repayments, and a 10-year term holding onto the property until the next up cycle would be recommended, rather than realising any losses.
15. How will I know If my application is Successful?
You will be notified by email as your application progresses through the application process, which involves 4 stages. You will also be notified if any issues are encountered throughout the process and if fully funded at the completion of the process.
- You apply for a Property Assessment. An automated assessment is conducted on your property and a Property Assessment Report provided to you via email. The report includes an Investor Attractiveness Rating to provide guidance on whether your property will be attractive to Investors.
- After receiving the Property Assessment Report, you can decide to move to the Property Application stage. A manual valuation is conducted on the property, and you are sent the final valuation plus the Information Disclosure Statement. Now you can make the decision to list (or not list) your property on MyBrix, the details of how to do this will be included in the email.
- The listing process will include providing you with further information (such as detailed terms and conditions) as well as a request for you to obtain independent legal advice on whether or not you should seek funding from MyBrix, you will need to obtain a certificate from your legal advisor that covers all persons on the property title, stating that you have obtained independent legal advice and based on this advice you wish to progress your MyBrix application. Without this certificate, your application cannot be progressed.
- Once all application and information requests have been completed via our online process, your property will be listed for funding on MyBrix. The last stage involves Investors agreeing to participate in the purchase of your Brix in a defined timeframe nominated by you.
Only once all 4 stages have been completed, is any funding guaranteed. Settlement will then be undertaken and a mortgage listed on the title in favour of MyBrix holders.
16. What happens If the property doesn’t get enough funding from Investors?
There are many variables that may cause your listing on MyBrix to not be fully funded. The main issue will be attractiveness to Investors, if Investors do not find your property attractive enough to invest, you may consider increasing the attractiveness of your offer by offering some portion of your property as Gold Brix or paying an additional fee to feature your property to Investors. You can also discontinue the funding process at any time prior to settlement.
17. What happens at the end of the MyBrix Term?
The property must be either sold or refinanced. You can refinance with anyone (including MyBrix). Refinancing with MyBrix will be via a new facility with a new 10-year term. The property will be revalued to establish the market value at the start of the new term and all original Investors paid out based on the new valuations.
If you refinance with another provider all MyBrix Investors must be paid based on current market value, as determined by MyBrix valuation.
18. Can I terminate the facility before the End of Term?
Yes, you can at any time do a compulsory buyback of all Brix from all Investors, the buyback price will be set at the market valuation at that time plus 10%.
To commence a “compulsory buy back” you will need to provide evidence to MyBrix that you have access to the funds needed to undertake the buyback.
19. Who owns my Property?
You do. Your property remains in your name (and the names of any Joint Tenants or Tenants in Common) and you continue to own the property, the only thing you do not own is 100% of the sale proceeds of your property. When your property is sold or refinanced all Brix holders are paid proportionally based on their Brix holdings including you the Property Owner.
20. What can I do with the MyBrix Funding?
The first thing that any MyBrix funding is applied to is your existing mortgage with the bank, this needs to be paid out first as well as any outstanding fees owed to MyBrix. Any excess funds can be used for anything you want. Note you must always hold a minimum 5% of all Brix in your property.
21. Can I buy Brix from Investors?
Yes, the best way to do this is via a structured Indexed buyback program, alternatively you can at any time go onto the trading platform (coming in 2024) and buy as many Brix in your property (or any other MyBrix property) as you want, at the current market price.
22. What happens if I Die?
If your property is held as a “Joint Tenancy” your MyBrix facility will continue for the balance of the term with the surviving joint tenant as the beneficiary regardless of any will.
If you are the sole owner or some other type of owner, we will commence the sale process as soon as possible after being notified, with the funds normally due to you provided to your Executor for distribution to your beneficiaries.
23. Can my property be Repossessed?
There can be no repossession for non-payment as you are not required to make any monthly repayments for your property. You can continue to live in your property for the duration of the MyBrix term, if you are funded solely via Standard Brix.
There are, however, essential terms and conditions which you must comply with. Breaching these conditions, e.g., causing the property to fall into disrepair, renting property without approval, selling property without approval etc., may result in financial consequences including in some cases repossession.
24. Can I sell my property anytime I Want?
Yes, you can sell your property at any time during the Term.
However, as per the terms and conditions of the MyBrix facility, MyBrix will fully manage the sale process end to end for an agreed fixed portion of the Sale Price.
MyBrix will appoint a Licensed Real Estate Agent that is local to your property to undertake the sale as well as a Conveyancer. MyBrix will also manage the sale process on your behalf, e.g., auction or standard sale and reserve price.
MyBrix will also implement (in conjunction with the appointed Real Estate Agent) a marketing campaign designed to maximise the sale price of the property for your benefit as well as all holders of Brix in your property.
25. Can I rent out my Property?
Yes, if you are funded via Silver Brix. If you are funded via Standard Brix you must pay an additional fee to convert to Silver Brix.
Owner Occupied properties utilise Standard Brix, which are priced differently to Silver Brix (which are used for rental properties) therefore prior to renting your property (including long term rentals as well as short term rentals such as AirBnB) you need to pay an additional fee to convert your Standard Brix to Silver Brix. You can do this at any time during the funding term.
Once you have converted to Silver Brix, as per the terms and conditions of the MyBrix facility, MyBrix will fully manage the rental process end to end, for an agreed fixed portion of the Gross Rental proceeds.
MyBrix will appoint a Licensed Real Estate Agent (or an Agent in the case of AirBnB) that is local to your property to manage the rental on behalf of all Brix holders.
MyBrix will distribute the net rental proceeds to all holders of Brix in your property on a proportional basis each month. If you own (say) 25% of the Brix you will get 25% of the net rental proceeds. If the property’s net rental proceeds are $2000 per month you will get $500 per month in net rental proceeds, with the remainder distributed to Investors who hold Brix in your property.
FOR THE AVOIDANCE OF DOUBT: RENTING (Short or long term) ANY PART OF A PROPERTY FINANCED UNDER OWNER OCCUPIED FUNDING (STANDARD BRIX) IS STRICTLY PROHIBITED.
26. Can I improve my Property?
Yes, of course it is your property, you can make any non-structural improvements without our approval, at your own cost. Any structural improvements will need to be approved by MyBrix prior to the commencement of any work which would not unnecessarily be withheld. Please note you may require relevant approvals from your local authority for some renovations.
27. Can I build a Granny Flat?
Yes, of course it’s your property, you can build a Granny Flat after seeking MyBrix approval (which would not unnecessarily be withheld) at your own cost and after gaining all the required approvals from your local Authority. Please note that should the Granny Flat be rented this needs to be facilitated by MyBrix and rental returns distributed to all Brix holders. If the main house remains your Principal Place of Residence (PPOR) you do not need to convert your Standard Brix to Sliver Brix.
28. What happens if I improve the property and it increases in Value?
Any change in the market value of your property is reflected in the price of each Brix, regardless of how the value increase was created. If the increase in value is due to property improvements that value increase is shared across all Brix holders proportionally.
29. Who pays for repairs and other costs such as Rates?
As a general rule, you should assume if you pay for something when you have a bank loan, you will continue to pay for it under MyBrix funding.
All repairs, rates, taxes and levies as well as all costs associated with keeping your property in the same or better condition as of the date of funding, is at the cost of the Property Owner.
30. What about Insurance?
You will need to fully insure the property at your own cost. It is a condition of MyBrix funding that your property is fully insured at all times for an amount that is acceptable to MyBrix and that MyBrix is noted on the policy as an interested party. You will need to provide copies of insurance to MyBrix initially as well as annually to comply with the terms of the MyBrix funding.
31. Can I live in my Rental Property?
It is important to realise that Investors have purchased Silver Brix in your rental property in the expectation of both Capital Gains and Rental Returns, therefore this structure must be maintained throughout the entire MyBrix finding term.
Should you decide you want to live in a property that was funded under the MyBrix Rental Property Owner process (Silver Brix), you must pay the Market Rent to MyBrix who will fully manage the Rental process end to end, for an agreed fixed portion of the Gross Rental Proceeds.
MyBrix will appoint a Licensed Real Estate Agent (or an Agent in the case of AirBnB) that is local to your property to manage the Rental on behalf of all Brix holders.
MyBrix will distribute the net rental proceeds to all holders of Brix in your property on a proportional basis each month. If you own (say) 25% of the Brix you will get 25% of the net rental. If the property net rental proceeds are $2000 per month you will get $500 per month in net rental proceeds with the remainder distributed to Investors who hold Brix in your property.
32. Is My Data Safe?
Yes, all our systems and processes are certified to the international standard for Information Security Management Systems (ISMS) which is called ISO 27001.
MyBrix uses a public Blockchain to record all Investor transactions and holdings, therefore these transactions are both transparent and immutable, providing the highest possible protection for your investment. No personal identifiable information is recorded on the Blockchain.
MyBrix does not provide any financial , Tax or other advice, you must obtain your own independent financial, legal and tax advice regarding the appropriateness of using any MyBrix Services, having regard to your personal objectives, financial situation and needs.You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented in this blog, any and all information presented in this blog is provided for information only and any action you take as a result is at your own risk.