Decision 1 · keep liquidity after closing

DSCR reserves: what stays available after closing?

Separate money paid at closing from money retained afterward. Compare three, six and nine months of payment coverage without treating a planning scenario as a lender requirement.

Sources checked October 30, 2026 · Fixed-date illustration · No rate or approval quote

Passing a DSCR ratio does not fund a cash reserve.

DSCR compares income with payment. Reserves ask what eligible assets remain after the transaction. Confirm the actual provider’s months, payment basis and asset rules before treating any balance as sufficient.

Start with two separate amounts

Fannie Mae’s conventional-loan guide defines liquid financial reserves as assets available after a mortgage closes, measures them in months of qualifying payment based on PITIA, and subtracts funds to close from available assets. That explains the distinction; it does not impose Fannie Mae’s underwriting rules on a DSCR provider.

Available assets

$113,000

Illustrative starting balance

Paid at closing

$98,000

Illustrative net funds still due

Left after closing

$15,000

113,000 − 98,000

All amounts are fictional. The $98,000 already represents the net cash still due at closing in this example; do not subtract an earnest-money credit again. We assume all $113,000 is eligible and accessible, with no other claim on it. A real file may not satisfy those assumptions.

With monthly PITIA of $2,100, the remaining $15,000 represents 7.14 months of that payment before any other use of the money. PITIA includes principal, interest, taxes, insurance and HOA. It does not include every cost of owning a rental.

Three planning scenarios, one closing amount

The three-, six- and nine-month levels below are sensitivity cases, not advertised minimums. Keep the same $2,100 payment and $98,000 closing amount to see only the effect of the chosen reserve period.

3 payment months

$6,300

kept after closing

Closing funds + reserves: $104,300
Compared with $113,000 available: $8,700 above the scenario

6 payment months

$12,600

kept after closing

Closing funds + reserves: $110,600
Compared with $113,000 available: $2,400 above the scenario

9 payment months

$18,900

kept after closing

Closing funds + reserves: $116,900
Compared with $113,000 available: $3,900 short of the scenario

At six months, the modeled reserve is $12,600 and $2,400 remains beyond it. That $2,400 is not automatically spendable profit: repairs, management, vacancy, other properties and lender asset conditions can still require cash. At nine months the model is $3,900 short, even though the loan’s rent-to-payment ratio has not changed.

Confirm what the provider actually counts

Months and payment: which reserve period and qualifying payment apply to this property and borrower?
Eligible balance: which accounts, ownership evidence, valuation adjustments and access restrictions apply?
Closing reconciliation: what net funds remain due after credits, and which assets have already been committed elsewhere?
Other properties: are additional reserves or obligations included for the rest of the portfolio?

Write down the lender’s answers next to the modeled figures. Do not use a regional vacancy rate as a rule for reserve months: it describes a housing-stock measure, not a forecast that your own unit will miss a specific number of rents.

Choose the next worksheet by the unresolved question

Source, assumptions and limits

Fannie Mae Selling Guide B3-4.1-01, checked October 30, 2026, supports the reserve definition and separation from closing funds. This page does not import its eligibility rules into a DSCR program. The $113,000, $98,000, $2,100 and three reserve periods are educational assumptions. No specific provider, approved loan or actual property is represented.