Last week, Fannie Mae issued a lender letter containing additional requirements for self-employed people looking for a home mortgage loan. Income from a business affected by changing economic conditions is not necessarily ineligible for use in qualifying a borrower for a home mortgage loan, but additional information will be required to determine if the income is stable. As of June 11th, lenders will be required to follow these new standards when qualifying a borrower for a home mortgage loan. The documentation now required by Fannie Mae includes a year-to-date profit and loss statement reporting revenue, expenses, and net income as well as the two most recent depository account statements. If these two documents do not support each other, additional statements or other documentation to support the year-to-date profit loss statement must be collected.
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