| Genuine Savings Explained
When applying for a home loan one of the important criteria a lender will ask for is a history of “Genuine Savings”. These are funds that you have gradually saved by yourself.
It proves to the lender that you have the self discipline over time to save a certain amount. It helps them assess your capacity to make monthly loan repayments.
Usually lenders will be looking for proof of at least 5% of the purchase price in genuine savings. Each lender has slightly different definitions and requirements.
Genuine savings although need to be substantial, may only account for a portion of your deposit.
What do lenders consider as “genuine savings”
- At least 3 months of accumulated savings
- A term deposit held for at least 3 months
- Shares or managed funds held for at least three months
Some lenders will consider rent that you have been paying over time (preferably 6-12 months) as part of genuine savings. Speak with your mortgage broker about this.
What is not “genuine savings”
- First Home Owners Grant
- Inheritance
- Gifts
- Tax Refunds
- Loaned money
- Money from the sale of something like a car
Different lenders have different rules on genuine savings (most will require some proof).
How Much Genuine Savings do You Need?
Typically you will be asked for a minimum of 5% of the purchase price. (On a $600,000 home you would need $30,000 in genuine savings). Then you can make up the rest of the deposit from other sources.
The best strategy is to speak with your Mortgage Broker. They will be able to advise and recommend the best lender suited to your individual situation.
Disclaimer: Although all care is taken. We do not give any warranty whatsoever to the accuracy of any content.
This is not meant to be financial or professional advice and is only of general nature. You must seek professional advice before taking any actions. The above information comes with no warranties whatsoever. We take no responsibility for any actions you may or may not take. All content is of general nature only and is NOT to be taken as advice whatsoever
Martin & Austin
Waldhoff
0422 426 065
MWaldhoff@areaspecialist.com.au
336 Main Road,
Glenorchy 7010 TAS
Martin & Hans recently welcomed the addition of a 3rd generation Waldhoff, Austin, into the team. Inviting him to learn from their 40 years’ experience in the real estate industry. Austin is keen to establish himself alongside these two reputable & knowledgeable representatives of the Hobart property market. Acting as their protégé & personal assistant for the time being as he strengthens his skillset regarding client management, negotiations, and legal procedure.
Martin brings 15 years of experience to the table and prides himself on negotiating the best outcomes for his clients. Empowering his vendors with the most modern marketing strategies available during the listing and selling of their property. Being a strong supporter of local produce and community growth, Martin is a member of the New Town Community Association & other groups. He’s down-to-earth, literally & figuratively, enjoying spending time in the garden as much as inside your home to help evaluate its place on the market.
Hans has been in real estate for 25 years. Receiving multiple awards as Tasmania's No. 1 Salesperson during his reign as 'King of the Hill' in Sandy Bay. Previously a civil engineer and accredited valuer in Germany, Hans has a deeper understanding of property than your average agent, and you'll find his insights invaluable whether you're buying or selling property in Hobart. Now over 80 years old, Hans’ enthusiasm for real estate has never waned and he continues to prove himself as one of PRD’s top salespersons monthly, effectively bolstered by his son & grandson.