Reglith
← All regulatory updates

Federal Home Loan Bank of Chicago (MPF Program)

MPF Announcement 2026-36

June 3, 2026

Summary

The MPF Program updated its income assessment requirements for MPF Traditional loans, effective September 1, 2026. Changes include new guidance on various income types such as alimony, annuities, public assistance, and unemployment benefits, as well as clarifications on continuance of income, employment gaps, and pay raises. Lenders must apply the new requirements to applications received on or after the effective date, with a transition period for earlier applications.

MPF Announcement: 2026-36

Date: June 3, 2026 Effective Date: September 1, 2026

MPF Traditional Selling – Income Assessment Updates

The MPF Program has updated the Income Assessment section of the MPF Traditional Selling Guide to improve clarity and consistency in income evaluation requirements.

The revised requirements are set forth in Section 5.3 Income Assessment (For Mortgage Loan Applications on or After September 1, 2026).

PFIs are encouraged to follow the updated requirements prior to the mandatory effective date and must apply them to all mortgage loan applications received on or after September 1, 2026.

To support implementation and allow Originators to complete pipeline loans, the prior income assessment requirements will remain effective for mortgage loan applications dated before September 1, 2026, as outlined in Chapter 5. Underwriting the Borrower (Effective for Mortgage Loan Applications prior to September 1, 2026).

During the transition period, Originators may apply either income assessment section in its entirety; however, combining or selectively applying requirements from both versions is not permitted.

Given the extent of these revisions, an attachment to this Announcement provides a detailed summary of the updates.

For questions or assistance, please contact the MPF Service Center by using one of the following options:

The following table describes the changes made to Section 5.3 Income Assessment.

New Policies
Section 5.3.6.1 – Alimony, Child Support, Equalization Payments, and Separate Maintenance Adding requirements for Equalization Payments
Section 5.3.6.2 – Annuity, Pension or Retirement Income Permitting personal and insurance annuity as allowable income types and outlining documentation and history of receipt requirements
Section 5.3.1.2 – Continuance of Income Requiring income continuance to be based on the note date
Section 5.3.4.5 – Employment by a Family /Interested Party Documenting and qualifying income when the borrower is employed by a family member or interested party
Section 5.3.4.5 – Employment Gaps Adding guidance for borrowers with employment gaps in the most recent 12 months
Section 5.3.4.5 – Pay Raises Adding guidance for qualifying borrowers with a recent pay increase from the same employer
Section 5.3.5.1 Fixed Base Income Enhancing clarity and consistency in the treatment of this income, including the definition of fixed base income, and providing guidance for income history
Section 5.3.5.1 Variable Base Income Clarifying requirements by defining variable base income, providing an alternative calculation method, and addressing when an employment job gap may be excluded
Section 5.3.5.4 – Housing (Parsonage) and Automobile Allowances Outlining documentation requirements and reducing the required history of receipt for auto allowance from two years to one year
Section 5.3.6.11 – Public Assistance Permitting Adoption Assistance as an acceptable public assistance income type, with verification that at least one payment has been received by the first due date
Section 5.3.5.8 – Seasonal Income Providing guidance for calculating qualifying income
Section 5.3.6.13 – Section 8 Housing Choice Voucher Homeownership Program Payments Requiring verification that at least one payment has been received by the first due date
Section 5.3.6.16 – Unemployment Benefit Income Requiring income to be calculated by averaging the applicable months based on income trends
Section 5.3.6.17 – VA Benefits Income Requiring verification that at least one payment has been received by the first due date and adding income continuance requirements
Updated Policy
Section 5.3.5.2 – Bonus, Commission, Overtime, and Tip Income Creating a single consolidated section addressing qualifying income and exclusion of job gaps due to documented non-recurring events
Section 5.3.5.3 – Employment Offers or Contracts Requiring a verbal VOE for both options and clarifying guidance on the executed offer or contract
Section 5.3.6.6 – Foster Care Income Revising documentation requirements and establishing that income must be calculated by averaging the applicable months based on income trends
Section 5.3.6.8 – Long-Term Disability Establishing a requirement for the lender to verify receipt of at least one payment by the first due date
Section 5.3.5.5 – Military Income Incorporating National Guard and Reserve members as eligible borrowers for military income, and providing additional guidance on the treatment of allowances
Section 5.3.5.9 – Temporary Leave Income Providing guidance on income continuance requirements during a period of temporary leave
Secondary Employment – moved to Section 5.3.4.5 Standards for Employment-Related Income Eliminating the reference to secondary employment and introducing a standalone section clarifying requirements when a borrower is simultaneously employed in more than one job

Source: https://www.fhlbmpf.com/program-guidelines/mpf-program-updates/mpf-announcement-2026-36

Common questions

What does "MPF Announcement 2026-36" cover?
The MPF Program updated its income assessment requirements for MPF Traditional loans, effective September 1, 2026. Changes include new guidance on various…
Which agency issued this update?
This update was issued by Federal Home Loan Bank of Chicago (MPF Program).
When was it published?
It was published on June 3, 2026.

Get the free weekly digest

Every mortgage regulatory change, summarized, in your inbox. No account needed.

Related updates