DSCR reserve requirement concerns for a 1031

[Ryan Cleary]

We are performing a 1031 where we will expect to have around $190,000 to put towards a nicer rental. I notice that many DSCR loans have a higher reserve, from what I have seen, cash reserves higher than the down payment. We don't have that, maybe half that. Is there a different avenue I should look towards? Thanks

[Alex Bekeza]

@Ryan Cleary What reserve requirement are you facing? With DSCR programs, we typically see 6 months PITI (worst case 9) + 1% of any outstanding mortgage balances which report to credit. Keep in mind most DSCR lenders also will count certain "near liquid" forms of reserves such as stocks, bonds, certain types of retirement accounts, etc.