In short: Genuine savings are funds you have saved yourself and held for three months, typically 5% of the purchase price. Lenders use them to prove you can manage money, not just that you have it. New PR holders often fail the test because the deposit arrived as a lump sum or sits across several accounts. Keep it in one account, add monthly, and leave it alone for 90 days.
Key takeaways
- Most lenders want 5% of the purchase price as genuine savings, held for three months, when you borrow more than 80% of the value. Policy is lender-dependent.
- Genuine means saved or held over time, not received last month. Gifts, tax refunds, bonuses and borrowed money usually do not count until they have seasoned.
- Some lenders accept 12 months of on-time rental payments as a substitute, which helps migrants who have rented for years.
- Consolidate your deposit into one account in your name, and stop moving money around. Every transfer between accounts is a question you will need to answer.
- Combined with the First Home Guarantee, a clean three-month history can get a PR holder into a home with 5% and no LMI.
Permanent residency changes what you can buy and which schemes you can use, but it does not change how a credit officer reads your bank statements. The three months after your PR grant are the perfect window to build the savings history that turns an application from "maybe" to "yes". Our genuine savings guide covers the rules in general; this post applies them to a new PR holder's situation.
What counts as genuine savings
| Usually counts | Usually does not count |
|---|---|
| Savings accumulated in your account over 3 or more months | A gift received within the last 3 months (unless the lender counts seasoned gifts) |
| Term deposits held 3 months or more | Tax refund received recently |
| Shares or managed funds held 3 months or more | Work bonus or commission received recently |
| First Home Super Saver amounts released by the ATO | Personal loan or credit card cash advance |
| Equity in property you already own | Sale of an asset within the last 3 months (some lenders accept with evidence) |
| Gifted money that has sat in your account for 3 months, with some lenders | Money held in a friend's or relative's account |
The ATO explains the First Home Super Saver Scheme, which lets eligible first home buyers release voluntary super contributions and is treated as genuine savings by most lenders.
Why new PR holders trip on this test
The pattern we see most often: a couple has been in Australia for four years, has $60,000 spread across three bank accounts and a term deposit, and moved $20,000 between accounts last month to chase a better rate. On paper they are careful savers. To the assessor, the last three months show large unexplained movements, and the total is not visibly "held".
The second pattern is money arriving right after PR. Relatives overseas hear the good news and want to help. For Nepali families, capital transfers from Nepal to buy property abroad are not permitted by Nepal Rastra Bank, and a lump sum arriving from overseas immediately before an application is the hardest deposit to use. Read deposit money from Nepal: what is legal before anyone transfers anything.
The 90-day plan
| Week | Action |
|---|---|
| Week 1 | Open or choose one savings account in your name (joint if buying together). Move all deposit funds into it once, and keep the transfer receipts. |
| Week 1 | Set an automatic transfer from your pay account on payday, even $500 a fortnight. Regularity matters more than size. |
| Weeks 1 to 12 | Do not withdraw from the savings account. Do not shuffle money to chase interest. Do not receive large deposits from friends or relatives. |
| Week 4 | Get your credit report and fix anything wrong. See credit score and home loans. |
| Week 8 | Gather payslips, PAYG statements, ID, PR grant notice and rental ledger. Use the home loan documents checklist. |
| Week 10 | Talk to a broker about pre-approval so the application lodges as the third statement closes. |
| Week 13 | Apply, with three clean statements and a rising balance. |
Moneysmart has a free savings goal calculator if you want to model the fortnightly transfers.
Worked example: a $600,000 townhouse in Epping
Ramesh and Sabina received PR in June. They want a $600,000 townhouse in Epping under the First Home Guarantee, which lets permanent residents buy with a 5% deposit and no LMI.
| Item | Amount |
|---|---|
| Purchase price | $600,000 |
| 5% deposit required | $30,000 |
| Existing savings, consolidated into one account in June | $24,000 |
| Automatic transfers, $1,000 a fortnight for 13 weeks | $6,500 |
| Balance at application in September | $30,500 |
| Victorian stamp duty at $600,000 for a first home buyer | Nil, full exemption applies at or below $600,000 |
| Loan at 95% LVR | $570,000 |
| Monthly repayment, for illustration at 6.00% p.a. over 30 years | About $3,417 |
Three statements show a balance rising from $24,000 to $30,500 with no withdrawals. That is precisely what an assessor wants to see. Because the property is at or below $600,000, they pay no stamp duty, and a new townhouse may also qualify for the $10,000 First Home Owner Grant. Check the deposit savings calculator and the First Home Guarantee eligibility calculator for your own numbers.
If you cannot show three months
Options exist. Some lenders substitute a 12-month rental history paid on time. Some accept a larger deposit (often 10% or more) with less emphasis on how it was saved. A guarantor loan can remove the genuine savings requirement altogether with certain lenders. And low-deposit home loans exist for borrowers with strong income but short history, at a cost. The right choice depends on your file, which is why we look at the statements before choosing the lender.
Frequently asked questions
Do genuine savings have to be exactly 5%?
Five per cent is the common benchmark for loans above 80% LVR, but it is a lender policy rather than a law. Some lenders want 5% only when the LVR is above 90%; others want it on every high-LVR loan. If your deposit is 20% or more, most lenders drop the genuine savings requirement entirely because there is no LMI exposure.
Does money I brought to Australia when I first migrated count?
If it has been in your Australian account for more than three months and the statements show it sitting there, yes. Lenders may still ask how it originally arrived, so keep the old remittance records. Money that arrived recently from overseas is assessed on its source, and for funds from Nepal the rules are restrictive.
Can rent history replace genuine savings for a PR holder?
With some lenders, yes. They typically want 12 months of rent paid on time through a licensed agent, with a ledger, and the rent needs to be comparable to the proposed repayment. Private rental arrangements paid in cash usually do not qualify. This option is valuable for migrants who have rented reliably for years but only recently started saving hard.
Should I close other accounts to make the history cleaner?
Not necessarily. Lenders ask for statements on accounts holding deposit funds, so the simplest approach is to keep your deposit in one account and leave everyday accounts alone. Closing accounts is not required, but moving money between them during the three months is what creates questions.
Talk to GNT Finance
We help new permanent residents across Melbourne's north and Australia-wide plan the three months before an application, then match the file to a lender whose genuine savings policy fits. In most cases there is no cost to you for our home-loan service. Book a free consultation or call 0426 403 703. Nepali speakers can work with our Nepali mortgage broker service, and if your partner is still on a temporary visa, see home loans for visa holders, the FIRB approval explainer and our new migrants guide.
This is general information, not migration, legal, tax or credit advice. Migration rules change often — confirm with a registered migration agent (MARA) or the Department of Home Affairs.
Written by Gorakh Timilsina
Founder, CEO & Senior Mortgage Consultant at GNT Finance. Gorakh started as a broker assistant, spent years as a senior credit officer assessing loan applications, and now helps Melbourne families get the right loan approved. English, Nepali and Hindi spoken.