Lenders are beginning to relax genuine savings requirements, allowing some buyers to purchase homes sooner.
According to Smartline managing director Chris Acret, a number of lenders are beginning to "normalise" their requirements for borrowers to have a genuine savings history.
"While this is not so much a move being made by the ‘big four’, we have certainly seen some of the smaller lenders start to loosen up somewhat on a genuine savings requirement," he said.
Acret said many borrowers are capable of servicing a mortgage, but are not as adept at saving. For these borrowers, non-genuine savings such as gifts or inheritances could be the answer, Acret said.
"There is a lot to be said for genuine savings, as it does create that money management skill and discipline. If you find it difficult to save a reasonable deposit over a period of time it does prompt the question as to whether you’re ready for a mortgage; however, most people are better off at paying off debt than saving, so it might be that the non-genuine savings loan is still an option," he said.
Acret said a handful of lenders will now also consider rental payment history in lieu of genuine savings.