Question on "Genuine Savings"

[smule]

What constitutes "genuine savings" ?

I had planned on getting a loan at 85 - 90 LVR, but I've just sold my rather expensive car which I had owned outright, and thinking it would be wise to tip this money towards the house i buy

Now when the bank reviews my statement for savings history will they question this recently deposited amount or will they accept is part of my "genuine savings" ?

 

[LynnH]

smule

My understanding is that the proceeds of the sale of an asset (car, boat, home, shares etc etc) are considered as 'genuine savings'.

I don't think you will have any problems with most banks, but perhaps one of our knowledgeable MBs could confirm this???

Cheers
LynnH

 

[BoatBoy]

Genuine savings may comprise of:

* A demonstrated saving pattern established over a 3-month period
* Gift - must be held in an account for a minimum of 3 months
* Term deposit - must have been held for a minimum of 3 months
* Cash - acceptable only if placed in an account for a minimum of 3 months
* Shares - must have been held for a minimum of 3 months
* Equity in existing property

http://www.loanmarket.com/?tag=lvr

Dave

 

[lostis]

How would the banks see it if I have no "savings", due to me using the money to pay off a loan?

But am going to be getting the 20% of the purchase from a family member.

 

[rugrat]

There are still some lenders who don't require genuine savings. And if this money is just a 'part' of the money that you are using for the deposit and purchase costs then you will find many institutions are willing to negotiate on how much genuine savings you need and what actually constitutes it. Talk to a mortgage broker or the bank in question and ask.

 

[LynnH]

My understanding is that the proceeds of the sale of an asset (car, boat, home, shares etc etc) are considered as 'genuine savings'.

http://www.loanmarket.com/?tag=lvr

Interesting, Dave.

I've just googled 'genuine savings' and read the first 20 pages (yep, sad isn't it? ) and it would seem that different organizations have different definitions of 'genuine savings'.

Suncorp, for example, includes non-preserved superannuation contributions in its definition of 'genuine savings".

http://www.suncorp.com.au/suncorp/Personal/home_loans/tips/glossary.aspx

And several other sites mention that non-repayable loans from family members can be considered as 'genuine savings'.

Wish I could remember where I read the bit about the proceeds of the sale of assets ..... early onset of 'old-timers' disease??

Do any of our knowledgeable MBs have anything to add to the 'debate'?

Cheers
LynnH

 

[Propertunity]

Do any of our knowledgeable MBs have anything to add to the 'debate'?

Probably too busy writing loans Lynn

I think the next 2 months to June 30 will be a panic rush of all the FHBs that either left things till the last minute or thought that, up until K Rudds announcement in the news yesterday, that the boost money would be extended.

 

[lostis]

Probably too busy writing loans Lynn

I think the next 2 months to June 30 will be a panic rush of all the FHBs that either left things till the last minute or thought that, up until K Rudds announcement in the news yesterday, that the boost money would be extended.

Just read in the news.com.au that KRUDD has come out again and said it was just "insider's talk"

I think we need another party to lead Australia, both the LIBS and LABOUR are absolutely useless.

the Australian Somersofters Party perhaps?

 

[BoatBoy]

are absolutely useless.

the Australian Somersofters Party perhaps?

Sound like a bunch of snakes

Dave

 

[pennyk]

many moons ago, when we went to Suncorp for our first home loan, one of the reasons they gave for knocking us back was that they couldn't see the history of genuine savings.... I had a term deposit, which I'd kept for 5 years or more, but hadn't added to for the past 3 years, apart from the interest,and because they couldn't see where the money came from initially, they wouldn't count it as genuine savings. (Of course, they never asked where the money came from).
they had several other reasons for knocking us back... all even more stupid than the last. I think we had a trainee bank manager, and they had decided to use us as the guinea pig for training on knocking back a loan.
Pen