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Why are they asking to see cash reserves?

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July 20 2011 - US
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I cannot believe you were not made aware of this upon application. Do you and the person originating your loan talk to one another?

Happy funding, Rudi
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July 28 2011
There aren't any lenders that will allow a gift for reserves.
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July 28 2011
Either your financial situation is at the maximum and the bank feels that they may be taking a risk to grant you a loan or you are purchasing a multi family home-either scenerio the bank will require reserves. The good thing is that since it is an FHA loan, most lenders will allow the reserves to be given to you in the form of a gift.
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July 28 2011
Many lenders require reserves for the approval of the loan.  You can use stocks, savings, checking and 401k to help meet the requirement.
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July 20 2011
There can be multiple reasons why the lender would want to see cash reserves.  I would check with your loan officer.

It's a lender's job to explain things thoroughly to their borrowers.  If you still have questions after getting the explanation, ask again.
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July 20 2011
If you are buying a multi family the lender could be requireing reserves.  To know for sure you will have to ask them...anyone else is just guessing.
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July 20 2011
Profile picture for sunnyview
They probably want to make sure that you can fully perform on the contract and that you have a financial safety net after you close if your ratios are close to the line. 
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July 20 2011
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This is a FHA loan though
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July 20 2011
It's probably because your financial situation appears to be about maxed out to the lender.  They want you to have a bit of money put in a 'cash reserve' so that you can still make your house pymt if you lose a job or get behind.
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July 20 2011
 
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