Fannie Mae Reverses Long Standing Policy Impacting Transferees
The government sponsored enterprise, Fannie Mae, has recently issued tougher underwriting guidelines that will most definitely affect borrowers involved in corporate relocation. “Trailing spouse income” will no longer be permitted for mortgage applicants looking to purchase a new home. A trailing spouse is defined as one who joins his or her spouse or partner in a job-related move, but who has yet to obtain employment in the new location.
Traditionally, lenders have been willing to count at least a portion of the income from the trailing spouse’s previous job toward qualifying income needed to finance the new home. Under the new guidelines, no consideration to this income will be given. If the sole income of the relocating employee is not sufficient enough to qualify for a mortgage, the couple will have to wait until the trailing spouse has secured employment in the new location.
This may force couples to buy less of a home than intended or force them to rent for an extended period of time. It may also deter them from accepting the job position or at the very least, prolong the relocation process. It inflates the current challenges associated with relocation, as it relates to homeowners and the sale/purchase of residences within the United States.
Posted on 08/5/2009 in Mortgage | Comments (1)
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