October 24, 2021

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FHA Loans and Social Security Income: Important Rule Changes

The Federal Housing Administration has issued new guidance to lenders regarding the use of Social Security Income to qualify for FHA home loans.

FHA/HUD Mortgagee Letter 12-15, “Documentation Requirements for Income from the Social Security Administration” lists the new rules for documenting and verifying SSI as income for the purposes of getting an FHA insured mortgage loan.

The mortgagee letter states, “The following guidance replaces HUD Handbook 4155.1, 4.D.2.k, in its entirety.”

“All income from the Social Security Administration (SSA) including, but not limited to, Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), and Social Security Income, can be used to qualify the borrower if the income has been verified, and is likely to continue for at least a three year period from the date of mortgage application.”

That’s good news for borrowers who would depend on this income in order to qualify for an FHA mortgage. The new guidelines include instructions to the lender on how to properly verify this income;

“The lender must verify income by obtaining from the borrower any one of the following documents:

–Federal tax returns;
–the most recent bank statement evidencing receipt of income from the SSA;
–a Proof of Income Letter, also known as a

Joe Wallace - Staff Writer

By Joe Wallace

August 27, 2012

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.

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