Fannie Mae rental income rules decide how much of your rent a lender can count when you apply for a mortgage. The rules changed in 2026, especially for homeowners who plan to rent out their current home and buy a new one. Here is what counts, what doesn’t, and how to plan ahead.

Why It Matters

Rental income can be the difference between qualifying and not qualifying. But many borrowers count their rent at 100% in their heads. The lender does not. Knowing the real number early keeps you from shopping for a home you cannot close on.

How Fannie Mae Rental Income Is Calculated

Situation	What Lenders Typically Use	How It Counts
Rental you have owned a while	Schedule E from your tax returns	Cash-flow analysis, averaged, minus the payment
Recently bought or newly rented	Lease or appraiser’s market rent (Form 1007)	75% of gross rent, minus the payment
2–4 unit home you live in	Lease or appraiser’s market rent	Rent from the other units can help you qualify
Departing residence (you are moving out)	Appraisal, Form 1007, or a market-rent analysis	75% of market rent, used only to offset that home’s payment

The 12-Month Property Management Rule

This rule trips up a lot of first-time landlords. Fannie Mae generally lets lenders add positive rental income to your qualifying income only if you have at least 12 months of property management experience. Lenders usually confirm this with tax returns or leases.

Without that history, positive rent can typically only offset the payment on that property. It still helps. It just cannot boost your income beyond that payment.

2026 Change: Renting Out Your Current Home

Fannie Mae updated its rules for a departing residence, the home you are moving out of and plan to rent. Here are the key points:

1. No lease needed. Lenders now use an appraisal, a comparable rent schedule (Form 1007), or a market-rent analysis instead of a signed lease.
2. 75% of market rent. The lender takes 75% of the market rent to allow for vacancy and upkeep.
3. Offset only. Positive rent can only offset that home’s full payment (PITIA). It is not added to your income.
4. Reserves. If you have less than 12 months of landlord experience, expect to show six months of that home’s payment in reserves.
5. Timing. Lenders could use the new rules right away and must apply them to applications dated on or after November 1, 2026.

The good news: you no longer need to find a tenant before you buy your next home.

Steps to Use Rental Income on Your Mortgage

1. Gather your last two years of tax returns. Schedule E is the lender’s first stop.
2. Pull current leases. Useful for recent purchases or new tenants.
3. Know your full payment on each rental. Principal, interest, taxes, insurance, and HOA dues.
4. Document your landlord history. Twelve months matters.
5. Plan reserves. Rentals usually require extra months of payments in the bank.

Common Mistakes to Avoid

• Counting 100% of the rent. Most calculations start at 75%.
• Heavy write-offs on Schedule E. Big deductions can shrink or erase usable rental income. Depreciation and some items may be added back, but not everything.
• Forgetting the full payment. Taxes, insurance, and HOA dues all count against the rent.
• Assuming every lender reads the rules the same way. Overlays vary from lender to lender.

Tips From 25+ Years in Florida Lending

• Talk to your tax preparer before you file if you plan to buy soon. How you report rentals affects how much income a lender can count.
• If you are building a rental portfolio, DSCR loans qualify on the property’s rent instead of your personal income. They are business-purpose loans for non-owner-occupied rental property.
• As a broker, I can compare how many wholesale lenders treat your rental income, which matters most when a file is close.

Example: Renting Out Your Current Home

This is an estimate based on the information provided. Say the market rent on the home you are leaving is $2,400 a month, and its full payment (PITIA) is $2,000.

Step	Amount
Market rent	$2,400
75% used for qualifying	$1,800
Full payment (PITIA)	$2,000
Amount still counted as a monthly debt	$200

Instead of carrying the full $2,000 payment as debt, you carry $200. If the numbers had come out positive, the extra would only offset that home’s payment, not add to your income.

Key Takeaways

• Lenders usually count 75% of lease or market rent.
• Twelve months of landlord experience is key to adding rent to your income.
• Departing residences no longer need a lease, but rent only offsets that home’s payment.
• The new departing-residence rules apply to applications on or after November 1, 2026.
• All loans are subject to credit approval.

Fannie Mae Rental Income FAQ

Does Fannie Mae count 100% of rental income?

No. When a lease or market rent is used, lenders generally count 75% of the gross rent to allow for vacancy and upkeep. Guidelines may change.

Do I need landlord experience to use rental income?

To add positive rental income to your qualifying income, Fannie Mae generally requires 12 months of property management experience. Without it, rent can typically only offset that property’s payment.

Do I need a lease to rent out my current home and buy a new one?

Under Fannie Mae’s 2026 update, no. Lenders use an appraisal, Form 1007, or a market-rent analysis instead. Some lenders may still ask for a lease or deposit.

Can I use rent from a duplex or fourplex I plan to live in?

Often, yes. Rent from the other units of a 2–4 unit home you live in can help you qualify. Program guidelines and lender overlays apply.

The Bottom Line

Fannie Mae rental income rules are more generous than many people think in some ways, and stricter in others. The 75% rule, the 12-month experience rule, and the new departing-residence rules all shape your numbers. Let’s run them before you make an offer. For other income types, see how lenders treat child support and alimony, seasonal income, commission income, and projected income.