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Fannie Mae Income Worksheet – Fill Out and Use

The Fannie Mae Income Worksheet is a tool for lenders to determine if the borrower's income is stable enough to qualify for a mortgage.

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Are you considering buying or refinancing a home in the near future? If so, you will likely need to complete a Fannie Mae income worksheet. This document is used to help determine whether you are eligible for a mortgage and, if so, how much you can afford. Completing the worksheet is not difficult, but it does require some patience and attention to detail. In this blog post, we will walk you through the steps of completing the Fannie Mae income worksheet and provide some tips for ensuring accuracy.

Below, you can see some specifics of fannie mae income worksheet PDF. You can go through it prior to typing in the gaps.

Question	Answer
Form Name	Fannie Mae Income Worksheet
Form Length	1 pages
Fillable?	No
Fillable fields	0
Avg. time to fill out	15 sec
Other names	fannie mae self employed worksheet, fannie mae income worksheet, mae income worksheet, fannie mae form 1038 fillable

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Rental Income Worksheet

Individual Rental Income from Investment Property(s): Monthly Qualifying Rental Income (or Loss)

Documentation Required:

Schedule E (IRS Form 1040) OR

Lease Agreement or Fannie Mae Form 1007 or Form 1025

Enter

Investment Property Address

Step 1. 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.

Step 1. Result: The number of months the property was in service:

Result

Step 2. Calculate monthly qualifying rental income (loss) using Step 2A: Schedule E OR Step 2B: Lease Agreement or Fannie Mae Form 1007 or Form 1025.

	Step 2 A. Schedule E - Part I
	Step 2 A. Schedule E - Part I
A1	Enter total rents received.	Enter

A2	Subtract total expenses.	Subtract

A3	Add back insurance expense.	Add

A4	Add back mortgage interest paid.	Add

A5	Add back tax expense.	Add

A6	Add back homeowners’ association dues.	Add
	This expense must be specifically identified on Schedule E in order to add it back.	Add

A7	Add back depreciation expense or depletion.	Add

A8	Add back any one-time extraordinary expense (e.g., casualty loss). There	Add
	must be evidence of the nature of the one-time extraordinary expense.	Add

	Equals adjusted rental income.	Total
A9	Divide by the number of months the property was in service (Step 1	Divide
	Result).	Divide
	Result).
	Equals adjusted monthly rental income	Total
A10	Subtract proposed PITIA (for subject property) or	Subtract
	existing PITIA (for non-subject property).	Subtract
	existing PITIA (for non-subject property).
	Step 2A. Result: Monthly qualifying rental income (or loss):	Result

Step 2 B. Lease Agreement OR Fannie Mae Form 1007 or Form 1025

This method is used when the transaction is a purchase, the property was acquired subsequent to the most recent tax filing, or

the lender has justification for using a lease agreement.

B1 Enter the gross monthly rent (from the lease agreement) or
market rent (reported on Form 1007 or Form 1025).	Enter

For multi-unit properties, combine gross rent from all rental units.

B2 Multiply gross monthly rent or market rent by 75% (.75). The remaining		Multiply	x.75	x.75
	25% accounts for vacancy loss, maintenance, and management expenses.	Multiply	x.75	x.75

	Equals adjusted monthly rental income.	Total
B3 Subtract proposed PITIA (for subject property) or existing PITIA (for non-		Subtract
	subject property).	Subtract
	subject property).

	Step 2B. Result: Monthly qualifying rental income (loss):	Result

Step 3. Determine the qualifying impact using the result of Step 2A or Step 2B.
If the combined result of Step 2A or 2B is positive, add the positive amount to the borrower’s

monthly qualifying income. Because the PITIA expense was included in the calculations above, do not add it to the debt-to-income (DTI) ratio.

If the combined result of Step 2A or 2B is negative, include the amount of the loss in the borrower’s monthly expenses when calculating the DTI ratio.

DU Data Entry	Monthly Income and Combined Housing Expenses	Mortgage Liabilities
DU Data Entry	Monthly Income and Combined Housing Expenses	Mortgage Liabilities

Subject	Enter the amount of the monthly qualifying income (positive result) or	For refinance transactions, identify the
Property	monthly qualifying loss (negative result) in “Subject Net Cash.”	mortgage as a subject property lien.
Non-Subject	Enter the amount of the monthly qualifying income (positive result) or	Identify the mortgage as a rental
Property	monthly qualifying loss (negative result) in “Net Rental.”	property lien.

Refer to the Rental Income topic in the Selling Guide for additional guidance.

Fannie Mae Form 1038

09.30.2014

Fannie Mae Income Worksheet – Fill Out and Use

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