Genuine savings refers to money you’ve saved up over time. Lenders like to see this because it shows you can manage money well and might be a reliable borrower. It’s essentially funds you’ve saved yourself, usually for at least three months. Note, however, that any deposit can become genuine savings by waiting three months. Just put the money into a savings account, add to it monthly for three months, and there you have it! It’s important to note this doesn’t apply to borrowed deposits.

What Is Accepted As Genuine Savings?

• Savings held or accumulated in your account for at least three months
• Equity from an existing property
• Dividend or bonus held for three months
• Historical rental payments

Some lenders consider gifts, inheritance, or even deposits paid to builders as genuine savings if it’s been in your account for at least three months. We’ve explained some of these scenarios below.

What Is Not Accepted As Genuine Savings?

• Government grants like FHOG
• Proposed savings or rental-purchase plan
• Savings not held in your account
• Windfall proceeds

Why Do Financiers Require Genuine Savings?

Banks view genuine savings as a sign that you are a good borrower. Lenders want to see that you’ve planned and saved for a deposit yourself and are not reliant on other sources.

How Much Do I Need?

Lenders typically ask for a minimum of 5% of the purchase price. The rest of your deposit can come from anywhere you like. For example, if you were buying a home for $500,000, then you’d need $25,000 in genuine savings.

Is A Deposit Paid To A Builder Genuine Savings?

A deposit paid to a builder, developer, or real estate agent is considered genuine savings by some lenders as long as the:

• Deposit has been held by the Builder, Developer, or Real Estate Agent for more than 3 months.
• Deposit wasn’t borrowed and we can prove that it was in your bank account prior to you paying your deposit.

This is common for off-the-plan properties where you may have paid the deposit over a year ago but the lender will ask you to prove another 5% of the property value as genuine savings at settlement.

Thankfully, you can apply with a lender that has a more reasonable approach. Please call us on 1300 889 743 or enquire online and one of our mortgage brokers will work out the best options for you.

Can I Get A Home Loan With No Genuine Savings?

Yes, you can. In the following section, we’ve explained several ways you can get a home loan even with no genuine savings.

Choose Lenders That Don’t Require Genuine Savings

No genuine savings home loans are available if you choose the right lender:

• You can borrow up to 95% of the property value.
• Interest rates are often the same as those for a regular loan.
• Ideally, you should have a good asset position, income, and employment stability.
• You will still need a deposit; however, it can come from almost any source.
• If you have no deposit at all, then consider a guarantor loan.

There are other specific criteria on which your application will be assessed so please check out our no genuine savings home loan page for more information.

📞 Call 1800 NO RIBA (667 422) or Apply Online Now!