How much reserves do I need for a conventional investment property?
Typically 6 months of full housing payment (PITI) on the subject investment property at minimum, plus 2 months on each of the borrower's other financed properties. Borrowers with 5+ financed properties face stricter reserve requirements per Fannie's multi-financed-property rule.
Plain-English explanation
Reserve math on investment-property conventional: subject property typically 6 months PITI; each other financed property 2 months PITI; primary residence usually has its own reserve calc separately. Reserves come from checking, savings, retirement accounts (vested portion at a discount), or stocks. Multi-financed-property borrowers (5+ financed properties) face increased reserve requirements per Fannie's published rule. Subject to Fannie/Freddie guidelines.
What can change the answer?
Down payment, reserves, rental income calculation, multi-financed-property reserve rules, and investment LLPAs all stack to drive pricing.
Want the real answer for your conventional file?
Conventional guidelines are the rule. Your credit, income, DTI, PMI, LLPAs, and Florida payment math are what decide the actual answer.
More conventional questions on Investment Property
Educational only. Conventional loan guidelines, lender overlays, rates, fees, PMI, LLPAs, and underwriting requirements can change. Final eligibility depends on full underwriting review.