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Do DSCR Loans Require Reserves After Closing?
Most DSCR lenders require reserves after closing because they want proof you can cover payments during vacancies or slow rental months.
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Typical reserve requirements
- 3–6 months for strong files
- 6–12 months for layered risk
- Higher reserves for STR properties
- Portfolio loans may require more
What counts as reserves
- Checking or savings accounts
- Stocks, bonds, mutual funds
- Retirement accounts (vested portion)
- Business funds with documentation
When lenders increase reserve requirements
- Low DSCR ratios
- Lower credit scores
- High‑risk property types
- Limited rental history
Compensating factors that reduce reserves
- DSCR ≥ 1.00
- Strong credit profile
- Larger down payment
- Stable rental income
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