Understanding Reserve Requirements: What You Need to Know

May 4, 2023

As a physician, purchasing a home can be an exciting and overwhelming experience. However, before you start looking for a home, it’s important to understand reserve requirements and how they can impact your mortgage process. In this blog post, we’ll explain what reserve requirements are, and what physicians need to know when buying a home. We’ll also share how Curbside Real Estate can help you find the right lender partners who offer physician home loans.

What are Reserve Requirements?

Reserve requirements are the amount of money a borrower needs to have in their bank account after closing on a mortgage. These funds act as a safety net for the lender and can help cover any unexpected expenses or mortgage payments in case the borrower experiences financial hardships.

Reserve requirements are calculated as a certain number of months of mortgage payments, including taxes and insurance. For instance, if your mortgage payment is $2,000 per month, and your reserve requirement is two months, you’ll need to have $4,000 in your bank account after closing on your mortgage.

Why are Reserve Requirements Important for Physicians?

As a physician, you may have unique financial circumstances that can impact your reserve requirements. For instance, you may have a significant amount of student loan debt or a high debt-to-income ratio (DTI) due to your medical school expenses.

Having a high DTI ratio can make it challenging to qualify for a mortgage or result in a higher interest rate. However, some lenders offer physician home loans, which can help you qualify for a mortgage with a higher DTI ratio or lower down payment requirements.

How Can Curbside Real Estate Help?

At Curbside Real Estate, we understand that purchasing a home can be stressful, especially for physicians who may have complex financial situations. That’s why we work with the best lender partner who offers physician home loans.

Our lender partners understand the unique financial needs of physicians and can help you find the right mortgage that meets your financial goals. Additionally, we offer a free Curbside Consult, where you can speak with our team and get personalized advice on your home buying journey.

Schedule a Curbside Consult Today!

If you’re a physician looking to buy a home, let Curbside Real Estate help you find the right lender partner for your needs. Schedule a free Curbside Consult with us today to get started on your home buying journey. Don’t have time for a call? Provide us a few details in this form and we will match you with the right partners for your home purchase.