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What does the bank (FHA) consider reserves?

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Anonymous
Not applicable
‎07-29-2008 07:45 AM
‎07-29-2008 07:45 AM

What does the bank (FHA) consider reserves?

We have 20K in our respective retirement accounts. Not that I would want to take them out but I in a desperate situation I would. Will these be considered reserves? What about vehicles? (We inherited a classic car worth $20K) What about equity in current home (We are keeping it for a rental). Thanks!
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ShanetheMortgageMan
Super Contributor
‎07-29-2008 10:56 AM
‎07-29-2008 10:56 AM

Re: What does the bank (FHA) consider reserves?

Only items you can immediately liquidate can be used as reserves.  On retirement accounts, 60% of the vested balance is used a qualifying reserves (70% if conventional financing).  Items such as most pensions, cars, stamp collections, or equity in a home cannot be used as qualifying reserves since they cannot be immediately liquidated.
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