Applying for a home loan is more than just filling out forms and providing bank statements. Lenders want to see evidence of both financial discipline and reliable income before committing to lend you hundreds of thousands of dollars. Two of the biggest indicators they look for are genuine savings and stable employment.

What lenders mean by genuine savings
Genuine savings aren’t just any funds sitting in your account. They refer to money you’ve saved gradually over time — typically over at least three months — from your own income. This shows the lender that you can manage your money responsibly and maintain a consistent habit of setting funds aside.

Examples of genuine savings include:

• Regular deposits into a savings account from your salary
• Term deposits built up over months or years
• Shares or investments purchased with your own saved funds

On the other hand, a lump sum from selling an asset, receiving a gift, or winning a prize might not be classified as genuine savings. While those funds can still help you with your deposit, they may not carry the same weight in proving your financial reliability.

Why genuine savings matter in loan approval
Lenders view genuine savings as a sign that you can handle the ongoing financial commitment of a mortgage. If you can save consistently before buying a home, you’re more likely to manage your loan repayments after the purchase.

In some cases, having a strong track record of genuine savings can also help offset other risk factors in your application, such as a smaller deposit or higher existing debts.

The link between savings and Lenders Mortgage Insurance (LMI)
If you have less than a 20% deposit, you’ll usually need to pay LMI, which protects the lender if you default. A history of genuine savings can sometimes help you negotiate with lenders for a better rate or a reduced LMI premium, as it demonstrates lower risk.

Stable income and its role in your application
Just as savings show financial discipline, steady employment reflects income reliability. Lenders prefer borrowers who have been in the same job — or at least the same industry — for a significant period, often six to 12 months or more.

This consistency reassures the lender that your income is dependable, reducing the perceived risk of missed repayments.

Employment changes and potential red flags
Switching jobs doesn’t automatically harm your application, especially if you’re moving to a role with better pay or similar duties. However, changing industries or moving into casual work just before applying for a loan can raise concerns. Lenders might request extra documentation or delay approval until they see a consistent income pattern in your new role.

How lenders assess casual and self-employed income
Casual employees and self-employed applicants face more scrutiny because their income can fluctuate. Lenders may ask for at least 12 to 24 months of income history, including tax returns, BAS statements, or accountant letters. Demonstrating steady earnings over time is crucial for these applicants.

Combining savings discipline with income stability
The strongest loan applications show both consistent savings habits and stable employment. Together, these factors reassure lenders that you not only have the funds to cover upfront costs but also the means to maintain repayments for the long term.

If you’re missing one of these elements — for example, you have stable employment but limited savings — it’s still worth discussing your situation with a broker. They can help you identify lenders more flexible with your circumstances.

The role of a mortgage broker
Navigating lender requirements for both genuine savings and employment stability can be challenging, especially for first-time buyers or those with non-traditional income. An experienced mortgage broker Brisbane buyers trust can guide you through the options, ensuring you present your financial history in the best possible light.

Steps to strengthen your position before applying
If you’re not ready to apply just yet, there are several ways to boost your appeal to lenders:

1. Start a dedicated savings account – Keep your deposit separate from everyday spending.
2. Automate savings – Schedule a recurring transfer from your main account after each payday.
3. Track your spending – Identify areas where you can cut costs and increase savings.
4. Avoid job hopping – If possible, delay career changes until after your loan is approved.
5. Keep financial records organised – Pay slips, bank statements, and tax returns should be easy to access when needed.

Final thoughts
While property prices and interest rates often dominate the headlines, the fundamentals of loan approval remain the same: lenders want borrowers with both financial discipline and reliable income. Genuine savings prove you can live below your means, while stable employment demonstrates you can maintain repayments over time.

By focusing on both areas before you apply, you’ll not only improve your chances of approval but also set yourself up for long-term financial stability once you move into your new home.