posted 2 years ago
Yes, you can dig as deep as you are able at the uphill end; just be aware that this will increase the likelihood of water wanting to get into your walls or floor. I would consider it imperative to use a good layer of fast-draining material like gravel all around and under the floor.
I would not depend on a swale to divert all of the water coming from uphill, though it would probably help. No matter how tight the soil packs when undisturbed, freshly placed backfill will be looser and allow water to get through it, and once a channel is started, it will always be a path for leaks.
In an underground house you will not have visible overhangs to divert water, but extending the roof membrane at least a meter or so, and well beyond the area you dug out, would help. I would slope the roof in the same direction as the hill as much as possible; even starting at the uphill end with that slope and then transitioning to shed water to the sides would make a difference. Sloping the roof to drain back into the hill would be the worst possible configuration.