It is with great news that we share that we have updated the guidelines with regards to Fannie Mae Loans and Paying Off Debt to Qualify.
Effective with 2015-06, FNMA has reversed their position on revolving debt payoff and will no longer require a revolving debt to be paid in full to also be closed. With this change, Fannie Mae now aligns with Freddie Mac and no longer requires revolving debt to be paid off at or prior to closing to be closed as a condition of excluding the payment from the DTI.(debt to income).
Specifically, FNMA states “revolving accounts that are paid down to zero at closing may remain open and no monthly payment needs to be included in the DTI ratio”.
Existing loans in the pipeline and new loan submissions can benefit from this enhancement immediately and no longer require revolving debt to be paid to be closed.
Should you have any questions / comments, please don’t hesitate to reach out to us 800-842-2910.