FinancingHomebuying Glossary
Cash Reserves
Savings left over after closing that lenders like to see as a financial safety cushion.
In plain English
Cash reserves are liquid savings you have available after covering your down payment and closing costs, usually measured in months of future mortgage payments. Some loan programs require a minimum amount of reserves to approve your loan.
Why it matters
Beyond satisfying a lender, healthy cash reserves protect you from an unexpected repair or income disruption right after you become a homeowner.
Where you'll run into it
Guides and tools on TheBuyingPath that cover cash reserves in context.
Related terms
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