Cash Reserves

Cash reserves are verified liquid or semi-liquid assets remaining in a borrower’s possession after settling all down payment and cash-to-close obligations on closing day. Lenders measure reserves in monthly PITI equivalents (e.g., six months of reserves on a $2,000 monthly payment equals $12,000 in remaining savings). While standard single-family primary residence loans often require zero to two months of reserves, multiple-unit properties, investment purchases, and jumbo loans routinely mandate higher post-closing reserves.