09/16/2026
Read My Full Blog at https://www.carolinahomefinancing.com/carolina-mortgage-insights-with-paul-mattos/fannie-mae-departing-residence-rental-income-rule
Fannie Mae just made it easier for some homeowners to convert their current home into a rental while purchasing another primary residence.
Previously, buyers commonly needed a signed lease to document the rent they expected to receive from the home they were leaving.
Under the new Fannie Mae guideline, a lease agreement will no longer be used to determine rental income from a departing primary residence.
Instead, the lender can establish the property’s market rent using:
• A complete appraisal that includes market rent
• A Form 1007 Comparable Rent Schedule
• A market-rent analysis with at least three comparable rental properties
This means an eligible buyer may be able to use the home’s supported market rent without finding a tenant or signing a lease before closing on the next home.
The calculation still matters.
The lender generally uses 75% of the supported rent and compares it against the departing home’s complete monthly housing expense. That includes principal, interest, property taxes, homeowners insurance, mortgage insurance, HOA dues, and applicable assessments.
If 75% of the rent covers the complete housing expense, the payment may be fully offset. Any excess cannot be added as additional qualifying income. If the rent falls short, the difference must be included in the borrower’s debt-to-income ratio.
Borrowers with less than 12 months of property-management experience must also document six months of reserves for the departing residence.
Fannie Mae is encouraging lenders to begin using the change now. It becomes mandatory for applications dated November 1, 2026, or later.
If you want to purchase another home while keeping your current property as a rental, contact me before you sell the property or sign a lease. We can review the market rent, complete housing expense, available reserves, and your purchasing power.
Paul Mattos
Refine Mortgage
NMLS #2339069
Licensed in North Carolina and South Carolina
CarolinaHomeFinancing.com
