Self-Employed Income: Schedule C Adjustments – For self-employed borrowers in Michigan, how income is calculated can vary by agency.
- Fannie Mae deducts both travel and meals expenses from Schedule C income
- Freddie Mac only deducts meals expenses, potentially allowing for a higher qualifying income
Secondary Employment Gaps
If you have a second job, guidelines differ significantly.
- Fannie Mae allows up to a 30-day gap in secondary employment
- FHA does not allow any gaps in secondary employment
Appraisal Waiver (AVM) Risk Scores
Automated Valuation Models (AVMs) can eliminate the need for a full appraisal, but eligibility varies by agency.
- Fannie Mae requires a risk score of 2.5 or higher
- Freddie Mac requires a risk score of 3.0 or higher
Asset Requirements: FHA
- FHA does NOT require borrowers to have sufficient funds to cover a 30-day AMEX (housing expense)
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