Common Questions
Mortgage Reserve
FAQ
How many months of reserves do I need for a conventional loan?
Most conventional lenders require 2–6 months of PITI reserves. The exact amount depends on your loan-to-value ratio, credit score, and whether the property is a primary residence, second home, or investment property. Investment properties typically require 6+ months.
Do FHA loans require reserves?
FHA loans do not have a standard reserve requirement for single-family primary residences, but lenders may impose their own overlays. For 3–4 unit properties, FHA requires 3 months of PITI reserves. ReserveRunwayCS flags FHA-specific requirements automatically.
What counts as mortgage reserves?
Liquid and semi-liquid assets count: checking accounts, savings accounts, money market accounts, CDs, stocks, bonds, and vested retirement accounts (typically at 60–70% of value). Gift funds generally do not count as reserves. Cash under the mattress does not count.
What is PITI and how is it calculated?
PITI stands for Principal, Interest, Taxes, and Insurance — the four components of a monthly mortgage payment. Reserves are measured in months of PITI. For example, if your PITI is $2,000/month and you have $12,000 in reserves, you have 6 months of reserves.
Is ReserveRunwayCS really free?
Yes — completely free, forever. No credit card required, no trial period, no subscription. All tools including the shock test and lender-ready report are included at no cost.
How does the payment shock test work?
The shock test lets you simulate worst-case scenarios — a rate adjustment, a job loss, or a large unexpected expense. It recalculates how many months your reserves would last under that scenario, so you can see your true financial cushion before you close.