Fannie Mae Manual Underwriting Changes for 2027: New Credit Score and Reserve Rules
From Feb 22, 2027, Fannie Mae uses one simpler chart for loans a person underwrites by hand, and VantageScore 4.0 already counts the same as Classic FICO. Here is what the numbers mean.
Every item cites an official source (FHFA, Fannie Mae, Freddie Mac, HUD or VA) and the date we checked it. Last checked Nov 9, 2026.
Official, in effect Since Nov 4, 2026: VantageScore 4.0 works for manual underwriting too
Most Fannie Mae and Freddie Mac loans are approved by their computer systems (Fannie's DU, Freddie's Loan Product Advisor). Some are manually underwritten, meaning a person at the lender reviews the file against a set chart of rules.
On Nov 4, 2026, Fannie Mae extended VantageScore 4.0 to manually underwritten loans and to loan files run through DU Version 12.1 (SEL-2026-10). The same day, Freddie Mac allowed VantageScore 4.0 for manually underwritten mortgages and removed the "Alt FICO Credit Fee in Price" from its Exhibit 19 (Bulletin 2026-15). Both took effect immediately.
Source: Fannie Mae Selling Guide Announcement SEL-2026-10, Nov 4, 2026 · Freddie Mac Guide Bulletin 2026-15, Nov 4, 2026 · Fannie Mae Selling Guide B3-5.1-01 · Checked Nov 9, 2026
Official, starts Feb 22, 2027 The new manual underwriting chart (Fannie Mae, loans delivered from Feb 22, 2027)
Fannie Mae Lender Letter LL-2026-09 replaces its manual underwriting rules with one chart for standard, HomeReady and HomeStyle Renovation loans on a home you live in. The same minimum score applies whether the lender uses Classic FICO or VantageScore 4.0. HomeReady and HomeStyle Renovation loans can still be manually underwritten only for purchases and limited cash-out refinances.
| Loan | Units | Max LTV | DTI up to 36%: score / reserves | DTI up to 45%: score / reserves |
|---|---|---|---|---|
| Purchase or limited cash-out refi | 1 | 95% | 680 (620 if LTV 75% or less) / 0 | 720 (680 if LTV 75% or less) / 0 |
| Purchase or limited cash-out refi | 2 | 85% | 660 / 6 | 680 / 6 |
| Purchase or limited cash-out refi | 3-4 | 75% | 660 / 6 | 680 / 6 |
| Cash-out refi (standard loans) | 1 | 80% | 680 / 0 | 720 / 6 |
| Cash-out refi (standard loans) | 2-4 | 75% | 680 / 12 | 720 / 12 |
Reserves are months of the housing payment you must still have in savings after closing. All rows are for a principal residence. Fannie will update its Eligibility Matrix when the change starts on Feb 22, 2027.
Source: Fannie Mae Lender Letter LL-2026-09, Nov 4, 2026 · Checked Nov 9, 2026
Worked examples
- Price $300,000 with 10% down: loan $270,000, so LTV is 90%.
- DTI 40%: that is over 36%, so the "up to 45%" column applies.
- Minimum score under the new chart: 720, with 0 months of reserves.
- Same buyer with DTI 34%: the "up to 36%" column applies, so the minimum is 680.
Example numbers are for learning only. Your lender's figures will differ.
- Price $400,000 with 15% down: loan $340,000, so LTV is 85%, the 2-unit maximum.
- DTI 35%: the "up to 36%" column applies, so the minimum score is 660.
- Reserves: 6 months. If the full monthly payment (principal, interest, taxes, insurance) is $2,900, that is $17,400 left in savings after closing.
Example numbers are for learning only. Your lender's figures will differ.
What this may mean for landlords and buyers
These points are our plain-English reading, not official guidance:
- Most buyers won't feel this. It only applies when a file is manually underwritten. Ask your loan officer which way your file will go.
- Closing after Feb 22, 2027? The date that counts is when the lender delivers the loan to Fannie Mae, which is usually after closing. Ask which chart your lender will use.
- House hackers: manual underwriting caps a 2-unit at 85% LTV and 3-4 units at 75%, and needs 6 months of reserves. The 5% down option for 2-4 units is a DU feature. See 2-4 unit and investor rules.
- Lenders can be stricter than these minimums ("overlays").
Source: Fannie Mae Lender Letter LL-2026-09, Nov 4, 2026 · Fannie Mae Selling Guide Announcement SEL-2026-10, Nov 4, 2026 · Checked Nov 9, 2026
General information only. Not legal, tax or financial advice. RentToolkit is not a lender, law firm or financial adviser. Mortgage rules change often and lenders can add stricter rules of their own ("overlays"), so confirm with the official source and a licensed loan officer before you act.