How to Manage Fannie Mae® Rep & Warrant for Wage Income

Overview

Income Analysis provides Fannie Mae® Rep and Warrant (R&W) results for Wage income, helping streamline loan fulfillment, reduce risk, and increase confidence in loan eligibility. When Wage income is submitted to Income Analysis, Fannie Mae automatically evaluates the income to determine eligibility for R&W relief.

Before you begin, keep the following in mind:

To receive R&W relief, you must select Fannie Mae from the Investor dropdown.
Underwriters can review Wage income from the Income Calculation tab, while Loan Officers can review it from the LO View tab.
The Employment Start Date is required for Fannie Mae to calculate and return Wage income R&W results.
Tip: For AutomatIQ® Borrower Portal loans you will need to enter this date. For Encompass loans, the date will be populated automatically using information from the loan file.
Fannie Mae may accept Supplemental Information to complete or improve Wage income calculations. This section is available as an expandable accordion within the investor popup.
The color of the FNMA Surround indicates the current R&W status.
You are not required to accept the calculations returned by Fannie Mae and may manually underwrite and update them as needed.
A DU Casefile ID is required to bind R&W relief. Without a DU Casefile ID, you can still view the Fannie Mae Wage results, but the calculations remain in PREVIEW MODE (displayed in red text) until the DU Casefile ID is added.
For Encompass® users, clicking Update LOS sends the updated calculations to the Loan Origination System (LOS).

Manage Fannie Mae Rep & Warrant for Wage income

Select the investor guideline

From the Investor Guideline dropdown menu, select FNMA (Fannie).
Review the messaging in the Investor Guideline Selection popup, then click Save.
Observe the Investor Guideline field and confirm that FNMA (Fannie) is now selected.

Identify the relief status

From the Income Calculation or LO View tabs, navigate to the Wage section.
Observe the FNMA Surround.

Green indicates that Fannie Mae has confirmed the Wage income for R&W relief. In this scenario the income figures are locked to prevent further edits.
Yellow indicates that additional information is required before Fannie Mae can evaluate the income. The Surround displays an exclamation point as an additional indicator.
Red indicates that Fannie Mae has confirmed the Wage income is eligible for R&W relief, but the Fannie Mae calculations have been unaccepted by a user so the income can be manually underwritten using alternate calculations.
Grey indicates that the Wage income has been reviewed by Fannie Mae and is not eligible for R&W relief.

Complete the missing information

Click the FNMA Surround to access the investor popup.
Enter or confirm the Employment Start Date.
Notes:
- The Employment Start Date is required for Fannie Mae to calculate and return Wage income R&W results.
- For Encompass loans, the Employment Start Date is populated automatically using information from the loan file.
Next, click Save Changes to send the information to Fannie Mae to receive an initial response.
In the Send Income to Fannie Mae pop-up, enter the DU Casefile ID (if available), then verify that the company checkbox is selected.
Note: You can send income data to Fannie Mae and view the resulting R&W findings without a DU Casefile ID. However, a DU Casefile ID must be provided before R&W relief can be bound. If the DU Casefile ID is not yet available, you can enter it later and resubmit as needed.
Click Send.

Complete optional Supplemental Information

Click the FNMA Surround to access the investor popup.
Review the Fannie Mae Income Items to identify which income was counted and determine your next steps.
Expand the Supplemental Information accordion.
Confirm or update how the borrower is paid. Updating these fields may improve Fannie Mae Wage calculations, especially when a borrower's hours fluctuate or the calculated income does not align with year-to-date earnings.
- Select either the Hourly or Salary radio button.
- Enter the borrower’s Hourly Rate of Pay $ or Annual Salary Amount, as applicable.
- Enter the Avg Hours Worked Per Pay Period for borrowers paid on an hourly basis.
- Confirm or update the paycheck frequency using the dropdown menu.
  Tip: Click the Paystub (PS) icon to review the paystub for the information needed to complete the Supplemental Information fields.
Review the Earning Category line items on each paystub to identify income you want to update or provide additional details for Fannie Mae to evaluate.
Tip: Use the Check Date dropdown menu to switch between the paychecks included in your analysis.
Complete the fields for the Earning Category you want to update before resubmitting the income to Fannie Mae. Depending on the income type, fields may include Adjusted Rate of Pay, Avg Hours Worked, Payout Frequency, and Last Received Date. For example a borrower may receive a year-end Bonus that is not yet reflected on the YTD paystub. In this example you would need to provide the Bonus amount, Payout Frequency and Last Received Date.
Enter any relevant comments in the Comment field.
Click Save Changes.
In the Send Income to Fannie Mae pop-up, enter the DU Casefile ID (if available), then verify that the company checkbox is selected.
Note: You can send income data to Fannie Mae and view the resulting R&W findings without a DU Casefile ID. However, a DU Casefile ID must be provided before R&W relief can be bound. If the DU Casefile ID is not yet available, you can enter it later and resubmit as needed.
Click Send.

Unaccept the Fannie Mae values to make edits

You are not required to accept Fannie Mae Wage income calculations. If you need to manually underwrite the loan or use alternative calculations, you can unaccept the Fannie Mae values and update the income details as needed.

Before you begin, note that accepted Fannie Mae Wage results lock the income fields and calculations. In this state, the Edit button is unavailable. To make changes, you must first unaccept the Fannie Mae values.

From the Wage section, click the FNMA Surround to open the investor popup.
In the Investor popup, click Unaccept. If the order does not have a DU Casefile ID, click Exit Preview instead.
Note: After you click Unaccept, the popup closes automatically and the Wage fields become available for editing.
Return to the Wage income line you want to update and click Edit.
Make the necessary changes in the Editing popup.
Enter any relevant comments in the Comment field.
Click Save Changes.
After completing your updates, click Resend to Fannie Mae.
Review the information in the Send Income to Fannie Mae popup, then click Send.
Tip: For Encompass®-integrated users once you complete this you can click Update LOS to send the updated calculations to your Loan Origination System (LOS).

Want to revert back to the approved Fannie Mae R&W calculations for wage?
You can revert back to Fannie Mae's approved calculations at any time by clicking FNMA Surround. In the Investor popup, click Accept if the file includes a DU Casefile ID, or Preview if a DU Casefile ID has not been added.

Outcome

You can manage Fannie Mae R&W results for Wage income by selecting Fannie Mae as the investor, identifying the relief status, and unaccepting calculations when manual underwriting is required.