Renting Out Your Current Home

Buying a new home while keeping your current home as a rental? There are a few important changes to be aware of when it comes to documenting expected rental income.

Under updated Fannie Mae guidelines, a signed lease agreement can no longer be used by itself to document rental income from a departing residence.

Instead, the lender must determine the property’s market rent using acceptable documentation.

What this means for a borrower:

• A signed lease alone may not be enough to use the expected rental income.
• The property’s market rent must be properly documented.
• Rental income may still be considered when determining qualifying income, depending on the loan guidelines and borrower’s situation.

If you’re planning to buy a new home and rent out your current one, I can help explain what documentation may be needed and how the rental income could factor into the financing.