An Operating Income Statement, Form 216, can be completed to determine the amount of operating income that can be used in evaluating an applicant’s credit on applications for conventional mortgages for certain investment and owner-occupied dwellings. Specifically, Form 216 applies to one-to-four-unit investment properties and two-to-four-unit owner-occupied properties.
To determine rental revenue, all income and expense projections are provided by the applicant or an appraiser to determine monthly net cash flow. If this form is completed by the applicant, an appraiser must also include their comments about the reasonableness of the projected operating income of the property.
*It is important to note that Fannie Mae does NOT require Form 216. However, as all lenders must report gross monthly rent at delivery, they often will need to utilize this Operating Income Statement form.
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