Rent As Genuine Savings

Will My Rent Be Accepted As Genuine Savings?

Use our genuine-savings calculator to see whether your rental history and deposit may meet the requirements of lenders that accept rent as genuine savings.

Can Rent Count As Genuine Savings For A Home Loan?

Yes, with certain lenders.

What the lender is usually interested in is not the total amount of rent you have paid. It is the payment history behind it.

A consistent rental record can show that you have been managing a substantial recurring expense over time. A lender that accepts this type of evidence may use it in place of the savings history it would normally require.

You still need a deposit and enough money to complete the purchase. You also have to qualify for the loan based on your income, expenses, debts, credit history and the property you are buying.

That distinction matters because deposit and genuine savings solve two different parts of the application.

How Does Rent As Genuine Savings Work?

Consider someone who has paid rent consistently for the past year but has only recently received their home loan deposit as a gift from their parents.

They have the required deposit amount, but they may not meet a lender’s standard genuine savings test because that money has not been sitting in their account or accumulated over the required period.

A lender with a rent-as-genuine-savings policy may assess the situation differently. The rental history can be considered for the genuine-savings requirement, while the family gift is assessed separately as the source of the deposit.

This is one of the most important things to understand about this policy: having enough deposit does not necessarily mean you satisfy a lender’s genuine savings rules.

Genuine Savings Vs Deposit Savings: What’s The Difference?

Your deposit is the money you can put towards purchasing the property.

Genuine savings is a lender requirement that looks at how some of that money was accumulated, held or otherwise evidenced.

For example, you could receive $50,000 from your parents yesterday and have enough cash for your required deposit. You have a deposit, but that does not mean you have $50,000 of traditional genuine savings.

With the right lender, an acceptable rental history may help bridge that gap.

Rent As Genuine Savings Vs Regular Savings

Regular savings and rental history can both provide evidence of financial discipline, but lenders assess them differently.

Traditional genuine savings generally involve money that you have saved or held over a required period.

With a rent-as-genuine-savings policy, the lender looks at your history of meeting rental payments.

Having traditional genuine savings generally gives you more lender options. Rent becomes particularly useful where the deposit is available but does not meet a lender’s normal savings-history requirement.

Rent As Genuine Savings Vs A Gifted Deposit

You do not necessarily have to choose between them.

A gifted deposit provides money for the purchase. Your rental history may help meet the separate genuine-savings requirement.

That combination can be useful for someone who has rented consistently but has only recently received money from their family.

The gift must still be acceptable to the lender and will usually need to be documented.

Which Lenders Accept Rent As Genuine Savings?

Several Australian lenders have policies that can recognise rental history as evidence of genuine savings, but not all banks do.

The conditions are not identical across lenders. They can differ on:

• How much rental history is required.
• Whether the loan must be owner-occupied.
• Whether you must be a first-home buyer.
• Whether all tenants must also be borrowers.
• Whether the property must be managed by a licensed agent.
• Whether private or family rentals are accepted.
• The required deposit and maximum LVR.

Lender policies can change, so a list of lenders should not be treated as permanent.

Home Loan Experts compares current lending policies to identify which lenders can consider your particular rental history and deposit structure.

Please call us on 1300 889 743 or enquire online and one of our commercial mortgage brokers will get back to you with some options.

Can Rent As Genuine Savings Help Me Avoid Saving For Three Months?

It can in some circumstances.

Suppose you already have an acceptable rental history but have only just received your deposit from an inheritance or family gift.

A lender that requires the deposit itself to meet its normal genuine savings test may make you wait until the funds have been held for the required period.

Another lender may accept your existing rental history for its genuine-savings requirement and assess the new deposit separately.

You have not bypassed the genuine-savings rules. You have found a lender whose rules recognise evidence you already have.

The exact treatment depends on current lender policy.

Does My Rent Need To Match My Proposed Mortgage Repayments?

Not necessarily.

Paying $500 a week in rent, for example, does not automatically prove that you can afford mortgage repayments of the same amount.

Your borrowing power is calculated separately using your income, living expenses, debts, credit limits, dependants and the lender’s serviceability assumptions.

Your existing rent may still provide useful context. If the jump from your current housing cost to the proposed mortgage commitment is large and your borrowing position is already tight, the application may require closer assessment.

Fast Track to Approval: Your Home Loan Checklist

A well-curated checklist to improve your chances of a home loan approval.

Disclaimer: By submitting this form, you consent to receive emails from Home Loan Experts, including your requested guide, home loan tips, updates and occasional promotional offers. You can unsubscribe at any time. View our Privacy Policy

Can I Use Rental History With The Australian Government 5% Deposit Scheme?

It may be possible, depending on the participating lender.

The Australian Government 5% Deposit Scheme and a lender’s genuine-savings policy are separate sets of requirements.

Meeting the Scheme’s eligibility criteria does not automatically mean your rental history will meet the participating lender’s credit policy.

Where a participating lender accepts rental history for genuine savings, the two may work together. You still have to meet the Scheme requirements and the lender’s own lending criteria.