The difference between genuine and non-genuine savings

Put simply, genuine savings is money you have saved up over time. Lenders want to see that you are capable of building savings, as this can demonstrate your ability to manage money – and might indicate you’ll be a good borrower.

So, for example, if you’ve diligently put away $250 each month over two years, you’ll have $6,000 (plus any interest) towards a deposit. This will be classed as genuine savings as you’ve accumulated them over time.

Sometimes just showing that you can save regularly (for even just three months) is enough to demonstrate genuine savings. Likewise, stocks and shares can often be considered genuine savings if they have been held for at least six months.

Non-genuine savings is money that you’ve recently acquired that hasn’t been saved by yourself or been in your possession for at least three months. This could be through an inheritance, a gift, funds from selling a large asset, or if the bank of mum and dad are funding your deposit.

 Non-genuine savings can include: Gifts and inheritance, Equity in an existing property, Tax refunds, Bonuses, Sale of an asset, Sale of shares

Tip: Savings aren’t ‘non-genuine’ forever. If the non-genuine savings are held in your account for at least three months, then they could be classified as genuine savings.