Fannie Mae Provides Three New Rental Income Forms

1 Fannie Mae Provides Three New Rental Income Forms (Effective October 2014) Rental Income Worksheet for Principal Residence, 2-4 Unit Property Rental Income Worksheet for Individual Rental Income from Investment Property(s) Rental Income Worksheet for Business Rental Income from Investment Property(s) Fannie Mae Form 1037 Use this form for an owner occupied 2-4 Unit Property for both refinances or Purchases (Borrower must occupy at least one unit when using this form). Fannie Mae Form 1038 Use this form for any other investment properties owned (or being purchased) by the borrower, including single-family or 1-4 Family properties.

2 Fannie Mae Form 1039 Use this form when the borrower is personally obligated on the mortgage (as reflected on the credit report) and the gross rents are reported on a 1065 or 1120S. Fannie Mae Form 1025 Small Residential Income Property Appraisal Report. Fannie Mae Form 1025 Small Residential Income Property Appraisal Report or Fannie Mae Form 1007 Single Family Comparable Rent Schedule N/A Documentation Required: Schedule E from IRS Form 1040 OR Lease Agreements or Fannie Mae Form 1025 You may use the Lease Agreement or Fannie Mae Form 1025 when the transaction is a purchase or the property was acquired subsequent to the most recent tax filing.

3 You will still gather the complete personal tax returns (1040) along with IRS Form Schedule E. Documentation Required: Schedule E from IRS Form 1040 OR Lease Agreements or Fannie Mae Form 1007 or Form 1025 You may use the Lease Agreement or Fannie Mae Form 1007 or Form 1025 when the transaction is a purchase; when the property was acquired subsequent to the most recent tax filing or when the lender has justification for using a lease agreement. You will still gather the complete personal tax returns (1040) along with IRS Form Schedule E.

4 Documentation Required: IRS Form 8825 (filed with either IRS Form 1065 or 1120S); OR Lease Agreements - You may use the Lease Agreement in certain circumstances such as when the property was acquired subsequent to the most recent tax filing, or when the lender has justification for using a lease agreement. You will still gather the complete business tax returns (either the 1065 or 1120S) and IRS Form 8825. When using Schedule E, determine the number of months the property was in service by dividing the Fair Rental Days by 30 ( If Fair Rental Days are not reported, the property is considered to be in service for 12 months unless there is evidence of a shorter term of service).

5 When using Schedule E, determine the number of months the property was in service by dividing the Fair Rental Days by 30 ( If Fair Rental Days are not reported, the property is considered to be in service for 12 months unless there is evidence of a shorter term of service). When using IRS Form 8825, determine the number of months the property was in service by dividing the Fair Rental Days by 30. (If Fair Rental Days are not reported, the property is considered to be in service for 12 months unless there is evidence of a shorter term of service).

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