Selling Guide Announcement (SEL-2026-09)

The Selling Guide has been updated to include changes to the following:

• Verbal Verification of Employment: increasing operational flexibility by removing specific verbal verification of employment methods and improving clarity by addressing requirements when borrowers use Schedule K-1 < 25% income to qualify
• Income Policy: updating requirements for Income Continuance and providing clarity on current loan delivery practices for Employment Offers or Contracts
• Attorney Opinion Letters and Right of First Refusal: expanding eligibility and clarifying requirements
• Digitizing seller’s designation of wire transfer instructions: introducing a more secure, self-service application replacing the manual PDF-based Form 482 submissions process and eliminating the requirements for Form 360

View the list of impacted topics.

Verbal verification of employment

We have removed the specific methods lenders must use to satisfy the verbal verification of employment requirement. The existing timing requirements for completing the verbal VOE remain unchanged.

With this update, lenders may use a verification method that is reasonable, verifiable, and appropriate for the borrower’s employment or income type.

Effective: Lenders may take advantage of these changes immediately.

Schedule K-1 <25% Income

In combination with this update, we are specifying that lenders must complete a verbal verification of employment for borrowers using Schedule K-1 income from a business in which they have less than 25% ownership to qualify. When the borrower also receives employment-related income from the same business, the applicable verification requirements depend on the borrower’s percentage of ownership. A verbal verification of employment is not required when rental income is the only income reported on Schedule K-1.

Effective: This change applies to loan applications dated on or after December 2, 2026.

Income policy updates

In response to lender feedback, we updated the Selling Guide to provide additional clarity to recent updates made to Chapter B3-3, Income Assessment.

• Income Assessment – The income continuance requirement is updated to reflect that income with a defined expiration date is expected to continue for at least three years from the application date instead of the note date.
• Employment Offers or Contracts – This requirement is updated to reflect acceptance of the fully executed and non-contingent offer or contract may be demonstrated through a signed agreement, written confirmation (e.g., email) or other verifiable means.
• Annuity, Pension and Retirement – This policy is updated to provide additional guidance for documentation requirements when the income begins after closing but prior to first payment date.

Effective: These policy changes are effective immediately.

Attorney Opinion Letters and Right of First Refusal

We have expanded eligibility for Attorney Opinion Letters (AOLs) by removing the following three restrictions:

• the requirement that AOLs be commonly accepted by private institutional investors in the local market,
• the exclusion of Texas Section 50(a)(6) loans, and
• the exclusion of loans executed under a power of attorney.

These changes provide lenders greater flexibility to use AOLs while retaining title protection requirements.

In addition, we have clarified that a tenant right of first refusal does not make a loan ineligible when the right arises from a statute or local ordinance rather than from a recorded instrument affecting the property. Recorded rights of first refusal remain subject to our existing Selling Guide requirements.

Effective: Lenders may take advantage of these changes immediately.

Digitizing seller’s designation of wire transfer instructions

We have implemented a new, more secure, self-service application that enables sellers to create, update, and deactivate wire transfer instructions for whole loan purchase proceeds. The application replaces the manual, PDF-based Seller's Designation of Wire Transfer Instructions (Form 482) submission process with a more secure digital workflow. This includes automated validations and approval controls, making wiring instructions available faster for use. As part of this change, we retired the Certificate of Authority, Incumbency, and Specimen Signatures (Form 360), eliminating the requirement for manual signature verification and callback procedures.

Effective: Lenders may begin using Form 482 application immediately.

Impacted Topics