Rental income can make a major difference when qualifying for a mortgage, especially for buyers who already own rental property, plan to convert their current home into a rental, or are purchasing an investment property.

Fannie Mae updated its rental-income guidelines in September 2026, and some of the changes are especially important for real-estate investors and homeowners planning their next move.

The basic idea is still familiar: lenders may be able to use rental income when calculating whether a borrower qualifies. What has changed is how that income can be documented and, in some situations, how much of it can actually help the borrower qualify.

Converting Your Current Home Into a Rental

One of the biggest changes affects what Fannie Mae calls a “departing residence.”

This is a home you currently occupy as your primary residence but plan to keep as a rental after purchasing another primary home.

Previously, borrowers often expected that obtaining a signed lease would be enough to establish the future rent. Under the new rules, a lease cannot be used to establish qualifying rental income for a departing residence.

Instead, the lender must support the expected rent using market evidence. That can include an appraisal with market rent, a Comparable Rent Schedule, or market-analysis tools such as MLS, Zillow or Redfin. When market-analysis tools are used, the lender generally needs at least three comparable rentals from the same market area when possible.

That is an important distinction for homeowners who are thinking:

“I’ll rent this house for $2,500 per month, so my lender can count $2,500.”

It does not work that way.

Fannie Mae Generally Uses 75% of Long-Term Rent

When projected long-term rental income is being used, Fannie Mae generally applies a 75% factor.

For example, if supported market rent is:

$2,400 per month

the lender would generally start with:

$2,400 × 75% = $1,800

The remaining 25% is intended to account for things such as vacancy and ongoing maintenance.

The lender then compares the qualifying rental income with the property's PITIA — principal, interest, property taxes, homeowners insurance and applicable association dues.

That 25% reduction is an underwriting calculation. It does not necessarily mean Fannie Mae expects your particular rental property to lose exactly 25% of its revenue every year.

A Departing Residence May Not Create Extra Qualifying Income

There is another important wrinkle.

For a departing residence, if 75% of the supported rent is greater than the property's PITIA, the positive amount can generally be used only to offset that property's housing expense.

If the calculation produces a loss, however, that negative amount has to be included in the borrower's debt-to-income ratio.

For example:

Market rent: $2,800
75% qualifying rent: $2,100
PITIA: $1,900

The property has $200 of positive adjusted rental income.

Under the departing-residence rules, that does not necessarily mean the borrower gets to add $200 to regular qualifying income. The rent can offset the property's housing obligation, but the treatment is more restrictive than many borrowers expect.

Property-Management Experience Now Matters More

This is one of the details I think buyers and investors should pay particular attention to.

Fannie Mae now distinguishes between borrowers with at least 12 months of rental-property-management experience and borrowers without that history.

Generally, positive rental income can be used as qualifying income when the borrower has at least 12 months of documented property-management experience.

Without that experience, qualifying rental income may be limited to offsetting the property's PITIA rather than creating additional qualifying income.

Fannie Mae allows lenders to document that experience through tax returns showing rental activity and, in certain situations, through lease documentation covering at least 12 months.

For someone buying a first rental property, that distinction can materially affect borrowing power.

Additional Reserves May Be Required

If you are converting your current primary residence into a rental and have less than 12 months of property-management experience, Fannie Mae requires the lender to verify six months of additional reserves for the departing property.

Those reserves are in addition to any other reserve requirements that may apply to the transaction.

So a borrower may qualify based on income but still need significantly more liquid assets than expected.

Buying Another Investment Property Within 45 Days

Fannie Mae also added specific rules for investors who recently purchased another investment property.

If an investment property was purchased within 45 days of the application date for the new mortgage, a lease agreement cannot be used to establish that property's qualifying rental income.

Instead, the lender has to use acceptable market-rent documentation.

The lender then generally uses 75% of supported rent, subtracts the property's PITIA, and treats the remaining amount under the applicable rental-income rules.

This can matter for investors trying to purchase several properties within a relatively short period.

Lease Agreements Have More Documentation Requirements

Leases are still usable in many situations, but Fannie Mae tightened the documentation.

For newly executed leases on properties that have not yet appeared on the borrower's tax return, the lease generally must have a term of at least six months.

The lender also needs evidence that the lease has actually taken effect.

That can include two consecutive months of documented rent payments. For a brand-new lease, the lender may instead document the security deposit and first full month's rent along with proof that the funds were deposited or transferred.

Fannie Mae also says these qualifying leases generally cannot be with a family member or another interested party when the property is not yet reflected on the borrower's tax return.

In other words, simply producing a signed lease immediately before applying for a mortgage may not be enough.

Short-Term Rentals Are Treated Differently

Fannie Mae now has a separate set of rules specifically addressing short-term rental income.

For purchases, eligible short-term rental income is limited to a one-unit investment property, and the property must legally be allowed to operate as a short-term rental under applicable registration and licensing requirements.

Short-term rental income from an accessory dwelling unit does not qualify under this section.

This is particularly relevant in Pinellas County, where buyers considering beach or vacation rentals should investigate not only financing requirements but also city, condominium and HOA rental restrictions before assuming short-term rental income will be available.

When qualifying based on validated short-term rental market data, Fannie Mae generally uses only 50% of the supported gross rental amount, rather than the 75% commonly used for long-term rent.

The other 50% is intended to account for vacancy and maintenance.

Fannie Mae also requires market data from comparable short-term rentals. The lender calculates expected rental income using comparable rental rates and the average number of days those properties are rented.

That can produce a very different qualifying number from simply looking at the property's projected Airbnb or VRBO revenue.

Existing Rental Properties May Be Calculated From Tax Returns

For established rental properties, lenders may rely on the borrower's Schedule E rather than simply taking 75% of the current lease amount.

When Schedule E is used, Fannie Mae allows certain expenses such as depreciation, mortgage interest, property taxes, insurance and HOA dues to be added back when calculating qualifying rental cash flow. Documented non-recurring expenses may also sometimes be added back.

This is why two investors who own properties producing the same rent can end up with very different qualifying income.

The property's history and the way the income appears on the borrower's tax return matter.

What This Means for Pinellas County Buyers

These rules can affect several common situations:

A homeowner in Seminole who wants to keep the current home as a rental and buy another primary residence.

A buyer purchasing a duplex or triplex and planning to live in one unit.

An investor buying another rental shortly after closing on the previous one.

A buyer purchasing a Clearwater Beach, Treasure Island or Indian Rocks Beach property with plans to use short-term rental income.

A landlord refinancing an existing rental property.

In each case, the question is not simply:

“How much will this property rent for?”

The better question is:

“How much of that rental income will my lender actually be allowed to use when qualifying me?”

Those can be two very different numbers.

Talk to the Lender Before Structuring the Purchase

If rental income is necessary for you to qualify, it is worth addressing the financing before making assumptions about the deal.

The property type, current occupancy, rental history, lease documentation, tax returns, management experience and timing of other property purchases can all affect the amount of income that ultimately counts.

Fannie Mae's September 2026 rental-income changes may be applied by lenders immediately and become mandatory under Fannie Mae's implementation schedule no later than November 1, 2026. Individual lenders may also have their own underwriting requirements or overlays.

If you're looking at an investment property or planning to keep your current Pinellas County home as a rental when you move, I can help you evaluate the real estate side of the decision and connect you with a lender who can review how the rental income may be treated before you get too far into the transaction.

Adi Rakanovic, Realtor
Lipply Real Estate | RealPinellas.com