Income assessment, now simplified

You asked. We listened. Easy to navigate income requirements are here.

Be ready to serve borrowers more confidently across various income scenarios. The updated Income Assessment section of the Selling Guide now delivers a more intuitive format to help you find what you’re looking for — faster. Language is clearer and navigation is simpler, providing a more streamlined way to evaluate income.

Explore the changes so you can apply updated income guidance with greater ease and better serve homeowners in your community.

Income policy updates and clarifications

This chart highlights key changes made to income policy throughout B3-3, Income Assessment. Use this legend to get familiar with the types of updates:

Use this legend to get familiar with the types of updates:

New Policy

New topic and/or new content.

Policy Change

Change made to, or removal of, an existing policy.

Policy Clarification

Policy relocated, renamed, or restated for clarity without altering its original intent or requirements.

B3-3.1-01
Stable and Predictable Income
View topic >

Policy Change

Removed guidance on individuals who change jobs frequently, as a new section on “Job Changes” has been added. See B3-3.2-02 shown below.

Policy Clarification

Restated for clarity without altering its original intent or requirements

B3-3.1-01
Continuance of Income
View topic >

Policy Change

Aligned policy for income sources requiring 3-year consistency to be based on the Note Date
Removed the example of income types with and without defined expiration dates as this information is included within each income source type

B3-3.1-01
Verification of Income for Non-U.S. Citizen Borrowers
View topic >

Policy Change

Removed the table outlining requirements for non-U.S. citizen borrowers

B3-3.1-01
Non-Occupant Borrower Income
View topic >

Policy Clarification

Restated for clarity without altering its original intent or requirements

B3-3.1-01
Nontaxable Income
View topic >

Policy Clarification

Relocated “Exceptions” to the respective Income Sources
Renamed “Nontaxable Income”

B3-3.1-01
Income Paid in Virtual Currency
View topic >

Policy Change

Relocated partial policy content from B3-3.1-09 to this section

Policy Clarification

Restated for clarity without altering its original intent or requirements

B3-3.1-01
Reduced Income Documentation Requirements for High LTV Refinance Loans
View topic >

Policy Clarification

Relocated policy content from B3-3.5-01 to this section

B3-3.1-01
DU Documentation Requirements
View topic >

Policy Clarification

Relocated policy content from B3-3.5-01 to this section
Relocated DU data entry references to DU Job Aids

B3-3.1-02
Federal Income Tax Return Standards
View topic >

Policy Clarification

Relocated Tax Return requirement from B3-3.1-02, Standards for Employment Documentation to this section

B3-3.1-02
Using Tax Transcripts in Lieu of Tax Returns
View topic >

Policy Clarification

Restated for clarity without altering its original intent or requirements

B3-3.1-02
Use of IRS Form 4506-C to Verify Borrower Income Documentation
View topic >

Policy Clarification

Restated for clarity without altering its original intent or requirements
Relocated partial policy content from “Completing and Submitting the IRS Authorization Form” from B3-3.1-06 to this section
Relocated policy content from B3-3.1-06 to this section

B3-3.1-02
Retaining the Tax Documents
View topic >

Policy Clarification

Restated for clarity without altering its original intent or requirements
Relocated policy content from B3-3.1-06 to this section

B3-3.1-03
Overview
View topic >

Policy Clarification

Relocated policy content from B3-3.1-10 to this section

B3-3.1-03
Findings Report
View topic >

Policy Clarification

Relocated policy content from B3-3.1-10 to this section

B3-3.1-03
Technology Service Provider
View topic >

Policy Clarification

Relocated policy content from B3-3.1-10 to this section

B3-3.1-03
Representations and Warranties Enforcement Relief
View topic >

Policy Clarification

Relocated policy content from B3-3.1-10 to this section

B3-3.1-03
Additional Requirements
View topic >

Policy Clarification

Relocated policy content from B3-3.1-10 to this section

B3-3.1-04
Verbal Verification of Employment
View topic >

Policy Clarification

Restated for clarity without altering its original intent or requirements
Relocated policy content from B3-3.1-07, Verbal Verification of Employment

B3-3.2-01
General Documentation Requirements
View topic >

Policy Clarification

Relocated policy content from B3-3.1-02 to this section
Relocated policy content from B3-3.5-01, Income and Employment Documentation for DU to this section

B3-3.2-01
Documentation Provided by the Borrower
View topic >

Policy Change

Removed the “Requirements – Tax Returns” reference and related guidance to B3-3.1-02

Policy Clarification

Relocated policy content from B3-3.1-02 to this section

B3-3.2-01
Documentation Provided by the Borrower’s Employer
View topic >

Policy Clarification

Restated for clarity without altering its original intent or requirements
Relocated policy content from B3-3.1-02 to this section

B3-3.2-01
Documentation Provided by a Third-Party Employment Verification Vendor
View topic >

Policy Clarification

Relocated policy content from B3-3.1-02 to this section

B3-3.2-02
Employment History
View topic >

New Policy

Added a new topic aligned with B3-3.1-01, Base Pay (Salary or Hourly), Bonus, and Overtime Income

B3-3.2-02
Multiple Jobs
View topic >

New Policy

Added a new section with content sourced from B3-3.1-05

Policy Change

Provided guidance for borrowers working multiple jobs simultaneously

Policy Clarification

Restated for clarity without altering its original intent or requirements
Removed the Secondary Employment Income policy as each income is analyzed on its own merit

B3-3.2-02
Employment Gaps
View topic >

New Policy

Added requirements for loans with employment gaps in the past 12 months

B3-3.2-02
Job Changes
View topic >

Policy Clarification

Relocated policy content from B3-3.1-01 to this section
Renamed as “Job Changes”

B3-3.2-02
Pay Raises
View topic >

New Policy

Added requirements to allow pay raises from current employment

B3-3.2-02
Employment by Family or Interested Party
View topic >

New Policy

Added requirements for income earned from a family member or interested party

B3-3.2-02
Foreign Income
View topic >

Policy Clarification

Restated for clarity without altering its original intent or requirements
Relocated policy content from B3-3.1-09 to this section

B3-3.3-01
Overview
View topic >

New Policy

Created a new section defining Fixed Base Income and Variable Base Income

B3-3.3-01
Fixed Base Income
View topic >

Policy Change

Updated documentation requirements for fixed base income: now only the most recent W-2 and pay stub are required (instead of W-2s for the past two years plus a pay stub)

Policy Clarification

Relocated policy content from B3-3.1-03 in this section
Relocated Bonus and Overtime Income to B3-3.3-02

B3-3.3-01
Variable Base Income
View topic >

Policy Change

Updated documentation requirements for variable base income: now only the most recent W-2 and pay stub are required (instead of W-2s for the past two years plus a pay stub)

Policy Clarification

Relocated policy content from B3-3.1-03, Base Pay (Salary or Hourly), Bonus and Overtime Income to this section

B3-3.3-02
Bonus, Commission, Overtime and Tip Income
View topic >

Policy Change

Updated Bonus and Overtime policies for determining qualifying income
Updated Commission policy for determining qualifying income
Updated Tip Income policy for determining qualifying income

Policy Clarification

Relocated policy content from B3-3.1-03 to this section
Relocated policy content from B3-3.1-04 to this section
Relocated policy content from B3-3.1-09 to this section

B3-3.3-03
Employment Offers or Contracts
View topic >

New Policy

Added that a VVOE is required for Option 2

Policy Change

Changes made to align requirements between Options 1 and 2

Policy Clarification

Restated for clarity without altering its original intent or requirements
Relocated policy content from B3-3.1-09 to this section

B3-3.3-04
Housing (Parsonage) and Automobile Allowances
View topic >

New Policy

Added documentation requirements
Reduced history requirement on automobile allowance from 2 years to 1 year to align with housing allowance policy

Policy Clarification

Relocated policy content from B3-3.1-09 to this section

B3-3.3-05
Military Income
View topic >

Policy Change

Removed reference to no employment gap greater than 12 months that is referenced in the current Section for Secondary Requirements (B3-3.1-05) that applied to Reservists

Policy Clarification

Relocated reference to Military Income from B3-3.1-03 to this section
Restated for clarity without altering its original intent or requirements

B3-3.3-06
Mortgage Differential Payments Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.3-07
Restricted Stock Units and Restricted Stock Employment Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.3-08
Seasonal Income
View topic >

New Policy

Added new policy to determine qualifying income

Policy Change

Removed Secondary Employment Income policy

Policy Clarification

Relocated policy content from B3-3.1-05 to this section

B3-3.3-09
Temporary Leave Income
View topic >

New Policy

Added new policy stating that income continuance requirement is established by the respective income source

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-01
Documentation Requirements for Current Receipt of Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-01
Reporting Other Income in DU
View topic >

Policy Clarification

Relocated policy content from B3-3.5-01 to this section
Relocated DU data entry references to DU Job Aids

B3-3.4-02
Alimony, Child Support, Equalization Payments, or Separate Maintenance
View topic >

New Policy

Included new policy on Equalization Payments and incorporated information from Documentation Requirements for Current Receipt of Income

Policy Clarification

Relocated policy content from B3-3.1-09 to this section

B3-3.4-03
Annuity, Pension, or Retirement Income
View topic >

Policy Change

Changed policy to include Personal and Insurance Annuities, qualifying income determination, and income continuance
Expanded documentation requirements for retirement income that begins after closing

Policy Clarification

Relocated policy content from B3-3.1-09 to this section and changed the header name

B3-3.4-04
Boarder Income
View topic >

Policy Change

Changed policy to include income continuance requirement

Policy Clarification

Relocated policy content from B3-3.1-09 to this section

B3-3.4-05
Capital Gains Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section

B3-3.4-06
Employment Related Assets as Qualifying Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-07
Foster-Care Income
View topic >

New Policy

Added new guidance on income trending

Policy Clarification

Relocated policy content from B3-3.1-09 to this section

B3-3.4-08
Interest and Dividend Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-09
Long-term Disability Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-10
Mortgage Credit Certificates
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-11
Notes Receivable Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-12
Public Assistance Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-13
Royalty Payment Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-14
Section 8 Housing Choice Voucher Homeownership Program Payments
View topic >

New Policy

Created a new section using content from B3-3.1-09

B3-3.4-15
Social Security Income
View topic >

Policy Change

Changed policy to include qualifying income determination

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-16
Trust Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-17
Unemployment Benefits Income
View topic >

Policy Change

Changed policy to include income continuance and determination of qualifying income

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-18
VA Benefits Income
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section
Restated for clarity without altering its original intent or requirements

B3-3.4-19
Schedule K-1 Income <25% Ownership
View topic >

Policy Clarification

Relocated policy content from B3-3.1-09 to this section

B3-3.5
Self-Employment Income
View topic >

Policy Clarification

Relocated from B3-3.2 to B3-3.5

B3-3.6
Self-Employment Documentation Requirements for an Individual
View topic >

Policy Clarification

Moved from B3-3.3 to B3-3.6

B3-3.7
Self-Employment Documentation Requirements for a Business
View topic >

Policy Clarification

Moved from B3-3.4 to B3-3.7

B3-3.8
Rental Income
View topic >

Policy Clarification

Moved from B3-3.1-08 to B3-3.8

Frequently asked questions

Dive into common questions about our income policy updates.

The Income Assessment chapter (B3-3) of the Selling Guide was updated on March 4, 2026, to improve clarity, navigation, and usability. The update provides a clearer structure, a more intuitive format, and several policy updates and clarifications.

A more intuitive layout, simplified language, reduced redundancy, and reorganized sections. As some content has moved, be sure to review and update any previously bookmarked pages.

Lenders may apply these changes immediately but must do so no later than June 1, 2026. If needed, prior Selling Guide versions can be accessed from the Selling and Servicing Policy Archives.

This initiative is part of a broader effort to improve the clarity, structure, and usability of the Selling Guide. Additional sections may undergo similar updates based on lender needs and market evolution.

Review the Income Assessment section of the Top Trending Selling FAQs for scenarios that demonstrate the application of policy in real-world lending situations.