Cash Reserves For a Loan

[RJ Gustilo]

Has anybody felt they ran into a set back after learning about having the need to have 6 months of reserves required by banks? I am a newbie investor looking for my first investment in the next few months and have enough for the down and closing costs but a couple weeks ago I started talking to lenders and learned I need to have 6 months of reserves based on a percentage on the loan on top of the out of pocket expenses. Was wondering what people have done when they ran into this? Is saving more and waiting the only option I have right now? Hope this concern is a valid one to ask about in this forum. Thanks.

[Scott Kaczmarek]

The lender I work with considers my traditional retirement accounts and personal reserves enough to cover the reserve requirements for my REI activities. However, I like to keep my personal money just that - personal. For REI, I do make sure I have reserves dedicated for that. It’s a personal choice, but I do sleep better at night!