What percentage of a stock portfolio account can a borrower use for reserves?

When considering the use of stock portfolio accounts for reserves in mortgage lending, borrowers are typically allowed to use 100% of the value of their stocks as reserves. This is because lenders recognize that liquid assets, like stocks, can be readily converted into cash, providing the borrower with the necessary funds to cover mortgage payments in case of financial difficulty. Therefore, including the full value of a stock portfolio in the calculations for reserves offers a complete and accurate picture of a borrower’s financial stability and ability to meet loan obligations.

In the context of the other options, while percentages less than 100% might be appropriate in certain circumstances (such as with non-liquid assets or accounts with specific withdrawal restrictions), they do not apply to the standard treatment of stock portfolios in reserve calculations. Moreover, percentages greater than 100% would not be practical or permissible in this context, as they would imply that the borrower has access to more cash than actually exists in their account. This is why 100% is the accepted percentage for utilizing stock portfolios as reserves in mortgage underwriting.