Home Loan Approval Guidelines To Change September 1, 2009

Mortgage rules change (again) on Tuesday as Fannie Mae is rolling out their new lending guidelines Tuesday, September 1, 2009.

Changes to the home loan approval guidelines:

1. Stock options are no longer eligible for ‘reserves’…a function of market volatility.
2. Relocating families can’t use the ‘trailing’ spouse’s projected income…a function of the job market
3. ‘Tip’ income must be documented and verified…income you didn’t pay tax on isn’t income, see also: How they got Capone
4. Lenders must call employers to verify employment…again, function of the job market
5. Lenders must verify tax transcripts against IRS records…another layer of fraud prevention
6. Owners and buyers of 2-unit homes are subject to new minimum FICOs with larger downpayment and equity requirements.
7. Only 70% of stock, bond and mutual values may be used as reserves
8. Only 60% of retirement assets may be used as reserves

The stock and retirement asset changes are probably too little, too late.