P.I.T.I. Reserves

P.I.T.I. Reserves – Cash reserves that a buyer is required to have on hand after their down payment is made. These are funds to protect a lender against default and are a set number of months of housing payments.

  • Example: Some types of higher leverage loans require a borrower to have a set number of months of housing payments saved away called, P.I.T.T. reserves, which give extra protection to the lender that the borrower will make the payments.
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