A couple weeks ago Fannie Mae made some updates to their guidelines. The following is a list of some key changes that will help more of your buyers qualify.....
Old Guideline:
Un-reimbursed business expenses for employees were counted against borrowers' qualifying income, increasing their qualifying debt-to-income ratios.
New Guideline:
Un-reimbursed business expenses are now only required to be factored into the qualifying debt ratios if >25% of the borrower's annual income is derived from commissions. This will help more borrowers qualify with less income restrictions!
Old Guideline:
Any Schedule C activity showing a small business loss hit the borrower for that loss, lowering overall qualifying income.
New Guideline:
For wage earners with secondary sources of income from self-employment, the loss will not be entered into the income calculation. This will help increase some borrowers' qualifying income!
Old Guideline:
Appraisers could not exceed maximum net and gross adjustments of 15% and 25% respectively for appraisal reports.
New Guideline:
The 15% net and 25% gross adjustment guidelines have been eliminated, allowing appraisers to use the most appropriate comparables, regardless of adjustments. This will help properties with limited comparable sales to report!
HOW YOU CAN USE THIS:
Be confident in knowing we are on top of all Fannie Mae guideline changes to ensure we can qualify as many of your clients as possible. The above changes all help ease the loan process for your buyers.
Contact us with questions any time...we're here to help!