Will your deposit count as genuine savings?
Where your deposit came from can matter as much as how much of it there is. This walks through the sources that usually count, the ones that usually do not, and what typically happens in between, so you find out now rather than partway through an application.
Why lenders care where the money came from
A deposit accumulated over time is treated as evidence that you can consistently set money aside, which is the behaviour a lender is trying to predict. A lump sum that appeared recently tells them nothing about that, which is why the treatment differs. It is not a judgement about the money being legitimate.
The sources that come up most often
Genuine savings usually means money you accumulated and held yourself, commonly around five per cent of the purchase price where the loan is above 90 per cent of the property value. Savings built over time, term deposits, and shares or managed funds held for the qualifying period generally count. A gift, an inheritance, a tax refund, a bonus or the proceeds of selling a car are all usable funds, but many lenders will not treat them as genuine savings until they have been held for the qualifying period, commonly around three months. A documented history of paying rent on time, commonly six to twelve months through a licensed agent, substitutes for the savings pattern at many lenders.
None of this is law. Genuine savings is lender policy: the threshold where it applies, the holding period, whether rent history substitutes and how a gift seasons all differ between lenders, which is exactly why the same deposit can pass at one and fail at another.
Regular savings held over a period are the straightforward case. Gifts, inheritances, sale proceeds, bonuses and funds released from superannuation are all treated differently from one another, and some are treated differently again depending on how long they have been held.
If part of your deposit will not count
That is a common position and it is usually workable. Some lenders take a different view from others, rent history can sometimes substitute, and a guarantor arrangement changes the question entirely. The important thing is knowing before you submit, because a declined application is harder to recover from than a well chosen first one.
What to bring to the conversation
Statements covering the period the deposit accumulated over, and a clear account of any large single deposits into that account. If a family gift is part of it, a gift letter is almost always requested; there is a template on this site you can copy.
Genuine savings questions
What actually counts as genuine savings?
Broadly, funds you have accumulated and held yourself over a period, evidenced by statements. The precise definition and the required period vary between lenders, which is exactly why a deposit that fails at one lender can be accepted at another.
Does a gift from my parents count?
A gift is generally treated differently from savings you accumulated, and lenders usually want it documented. Depending on the lender and how long the funds have been held, it may still support the application. The gifted deposit guide and the gift letter template both cover this.
Can paying rent count instead?
Some lenders will consider a documented rental history as an alternative, on the reasoning that meeting rent consistently demonstrates the same capacity. It is not universal and the evidence requirements differ, so it is worth confirming before relying on it.
What about money from selling a car or shares?
Sale proceeds are usually acceptable with evidence of the sale and the funds arriving, though treatment varies. The documentation matters more here than in most cases, because the lender is establishing where the money came from.
How long does money need to be held?
This varies by lender and is one of the specific figures worth confirming for your situation rather than assuming. Getting it wrong by a short period is a common and avoidable reason for a delayed application.
Related tools and guides
Estimates only, not credit or financial advice. This tool uses general assumptions and cannot see your credit file, verify your income or apply any particular lender's policy. Your position is confirmed in a full assessment.
Find out before a lender does.
Charles will tell you whether your deposit will stand up, and which lenders take a workable view if part of it will not. Free, no credit check.
