Mortgage Quality Control: 4506-T Income Verification
Verify Income with 4506-T Tax Transcripts
Many investors and agencies, such as Fannie Mae and Freddie Mac, require certain documentation to verify a borrower's income on every loan originated. Under new guidelines for Fannie Mae and Freddie Mac, you will need to obtain a signed 4506-T from borrowers at both application and closing.*
Fannie Mae "highly recommends that the 4506-T transcripts be obtained from the IRS (or designee) for transactions prior to closing and used to validate the income documentation provided by the borrower and used during the underwriting process." (Fannie Mae Announcement 09-19)
Receive IRS Tax Transcripts in 24-48 Hours
You can order 1, 2, 3, or 4 year tax transcripts. Once you sign up with us, we will send you a username and password to our secured server. Then simply drag and drop the borrower's signed Form 4506-T to our secured server, and we will send you the tax transcript directly from the IRS in 24-48 hours.
Where Can I Read the Official Requirement?*
- Lenders must "obtain a completed and signed Form 4506-T from all borrowers at both application and closing…on all applications dated on or after September 1, 2009."
- 4506-T transcripts should be "used to validate the income documentation provided by the borrower and used during the underwriting process." (Fannie Mae Announcement 09-19)
- Sellers must "obtain a signed IRS Form 4506-T for all Borrowers, whose income is used to qualify, on both the application date and on the Note Date...
- Effective for Mortgages with application dates on or after February 15, 2010 and Settlement Dates on or after April 1, 2010." (See Freddie Mac Bulletin 2009-27)