5.6 Savings
- Borrowers who have saved a deposit are generally more likely to be prepared for difficult circumstances
- Genuine savings need to be evidenced in the following circumstances:
| Product | Loan Purpose | LVR | Genuine Equity Requirement |
| Standard | Purchase/construction | >85% | Owner occupied - 5%
Investment - 10% |
| Low Doc | Purchase/construction | Any | 20% |
| HomeBuyer Plus | Purchase/construction | Any | Nil |
5.6.1 Genuine Savings
| Genuine savings | -
Must be held in the borrowers name and include:
- Funds held or accumulated in savings accounts for 3 months or more
- Equity in residential property
- Term deposits held for 3 months or more
- Shares held for no less than the last 3 months
- Genworth may allow a gift / inheritance to be used where savings have been sacrificed by making accelerated loan repayments over the last 3 months. In these circumstances, the existing savings plus the value of excess repayments must be equal to or greater than the minimum savings required.
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Refer to section 6 Documentation for verification details.
5.6.2 Non Genuine Savings
| Non Genuine savings | -
Do not contribute towards the 5% genuine savings requirement - And include:
- Gifts or inheritance (see Genuine Savings above)
- Proposed savings plans or Rental Purchase Plans of any kind
- Sale of assets (other than real estate) for example, motor vehicles
- FHOG
- Funds held in company/business accounts
- The proceeds of a personal loan
- Builder’s or vendor’s rebate/incentive.
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Refer to section 6 Documentation for verification details.
5.6.3 Savings Plans/Rental Purchase Plans
- Savings plans provide for the borrower to save for the deposit on a home after approval of a mortgage loan. Similarly, rental purchase type arrangements enable the borrower to save the deposit whilst occupying the security
- Neither of these types of plans are acceptable for mortgage insurance. Borrowers must have the required minimum genuine savings (as applicable) prior to mortgage insurance cover being approved.
5.6.4 First Home Saver Accounts
- First Home Saver Accounts is the initiative by the Australian Government aimed at assisting Australians aged 18 and over to save for their first home
- The government will contribute 17% on the first $5,000 (indexed) of individual contributions made each year with a capped balance of $75,000
- Funds saved in First Home Saver Accounts are acceptable as a form of genuine savings.