If your regular income streams are not sufficient to qualify (salary, social security, pension…), but you have a chunk of money in asset accounts, then we can use those assets to create income. It can give enough of a boost to qualify for a home you love! The income calculation does depend on if the lender follows Fannie Mae guidelines or Freddie Mac guidelines, but essentially Freddie allows you to take the total of all assets (minus down payment, closing costs and reserves) and divide by 240 months, whereas Fannie’s calculation takes the total divided by the loan term, which is usually 360 months. Both have maximum Loan-to-Value ratio requirements, and there are some other nuances we would need to review and satisfy. But it’s an excellent option for any low income, high asset borrowers, and even better to know there are alternative options available.
