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When borrowers have additional money saved up, they are less likely to miss their mortgage payments at least the first few payments.
They are mostly concerned about your payment ability in the short term, versus the long term. Heres why… Your lender may not keep your loan on its books for very long. They might sell it into the secondary market through Freddie Mac andor Fannie Mae (the government sponsored enterprises, or GSEs, that buy and sell bundled loans).
Youve probably heard about mortgage-backed securities, or MBS. Thats what they are.