Genuine savings are funds you’ve built up over time to show lenders you can manage money responsibly. Not all money in your account counts as genuine savings — bonuses, gifts, or borrowed funds often don’t qualify. We’ll break down what lenders accept, what doesn’t count, and how guarantor loans or other exceptions work so you can prepare with confidence.
Next Steps – Speak With a Mortgage Broker
Every lender has different rules for what qualifies as genuine savings. The right strategy for you depends on your deposit source, property type, and lender selection.
As your mortgage broker, I’ll help you:
- Identify which lenders are most flexible with your situation.
- Work around genuine savings restrictions using rental history or guarantor support.
- Maximise your borrowing power so you can buy sooner.
Genuine Savings Explained – What Counts, What Doesn’t, and Key Exceptions
When applying for your first home loan, most lenders want to see more than just your deposit — they want proof you can save consistently. This is where genuine savings come in.
What Are Genuine Savings?
Genuine savings are funds you’ve built up gradually, typically over 3–6 months, that show you have a track record of financial discipline. Lenders use this as a way to assess your ability to manage loan repayments.
Why Lenders Require Genuine Savings
For many lenders, genuine savings act as a safety net. They demonstrate that:
- You can manage your budget and live within your means.
- You’re less likely to default when financial stress arises.
- Your deposit isn’t just borrowed or gifted, but earned and managed.
What Counts as Genuine Savings
While each lender has slightly different rules, the most common examples include:
- Regular deposits into a savings account for at least 3 months.
- Term deposits held in your name for 3 months or longer.
- Shares, managed funds, or other investments held for a similar period.
- Equity built from property ownership (in some cases).
What Doesn’t Count as Genuine Savings
Not every dollar in your account will qualify. Common examples of what lenders exclude include:
- Gifts from family or friends (e.g., parental cash support).
- Borrowed funds (personal loans or credit cards).
- One-off lump sum deposits, such as a tax refund or work bonus.
- The First Home Owners Grant (FHOG) is not genuine, but it can be used toward the deposit.
Exceptions to Genuine Savings Rules
There are important exceptions where you may not need to show genuine savings:
- Guarantor Loans: If you have a family guarantor providing security, most lenders will waive the genuine savings requirement.
- High Deposits: Some lenders relax genuine savings rules if your deposit is larger than 20%.
- Non-Major Lenders: Certain banks and non-bank lenders have more flexible policies, accepting rental history as proof of saving discipline.
Pros and Cons of Genuine Savings Requirements
Pros:
- Demonstrates financial responsibility.
- Can improve your chances of loan approval.
- Shows you’re prepared for the long-term commitment of a mortgage.
Cons:
- Slows down the buying process if you don’t have a proven savings history.
- Restricts some first home buyers who rely on family support or bonuses.
- May feel unfair if you’ve built wealth through non-traditional means (e.g., business profits, crypto).
Why Genuine Savings Matter for Home Buyers and Investors
For first home buyers, genuine savings are often the biggest hurdle. Lenders want to see that you can manage a budget before approving a large loan.
For investors, genuine savings still apply but can often be shown through equity in an existing property or managed investment portfolios.
Example:
- A first home buyer with a $20,000 gift from parents may not meet the genuine savings rule. But if they’ve also been paying $450 per week rent on time for 12 months, some lenders may accept this as a substitute.