Introduction
This topic contains information on verbal verification of employment requirements
for all borrowers.
Lenders must obtain a verbal verification of employment (verbal VOE) for each borrower
using employment or self-employment income to qualify. The verbal VOE must be obtained
within 10 business days prior to the note date for employment income, and within 120
calendar days prior to the note date for self-employment income. The verbal VOE requirement
is intended to help lenders mitigate risk by confirming, as late in the process as
possible, that the borrower remains employed as originally disclosed on the loan application.
A change in the borrower’s employment status could have a significant impact on that
borrower’s capacity to repay the mortgage loan and must be fully reevaluated.
Alternatively, lenders may obtain the verbal VOE after closing, up to the time of
loan delivery. If the verbal VOE cannot be obtained prior to delivery, the loan is
ineligible for delivery to Fannie Mae.
The following table describes verbal VOE requirements:
| Type of Income |
Verbal VOE Requirements |
|
Hourly, Salary, and Commission Income (Non-Military)
|
Requirements:
-
The lender must independently obtain a phone number and, if possible, an address for
the borrower's employer. This can be accomplished by using a telephone book, the Internet,
directory assistance, or by contacting the applicable licensing bureau.
-
The lender must contact the employer verbally and confirm the borrower's current employment
status within 10 business days prior to the note date.
Alternative Methods to Verify Employment:
-
If the employer will not verbally verify employment, the lender can obtain
-
a written verification (other than an additional paystub) confirming the borrower’s
current employment status within the same time frame as the verbal VOE requirements.
The written documentation must include the name and title of the person who completed
the verification for the employer.
-
an email exchange with the borrower's employer from the employer's work email address
within the same time frame as the verbal VOE requirements.
-
-
The lender must conduct additional due diligence to confirm that the email address
for the employer is accurate. Examples of due diligence include, but are not limited
to, searches of domain name on employer website (review for match to employer email
address), employer directory on the internet, or other professional networking or
business profile websites.
-
The email exchange must include borrower's name and employer's name; name, title,
and work email address of the individual contacted at the employer; date of contact;
and borrower's current employment status.
-
If the borrower is a union member who works in an occupation that results in a series
of short-term job assignments (such as a skilled construction worker, longshoreman,
or stagehand), and the union facilitates the borrower’s placement in each assignment,
the lender may obtain the verbal VOE from the union.
-
If the employer uses a third-party employment verification vendor, the lender must
obtain written verification from the vendor of the borrower’s current employment status
within the same time frame as the verbal VOE requirements.
|
|
Military Personnel
|
If the borrower is in the military, in lieu of a verbal or written VOE, the lender
must obtain either
-
a military Leave and Earnings Statement dated within 120 calendar days prior to the
note date, or
-
a verification of employment through the Defense Manpower Data Center. See
E-1-02, List of Contacts for additional information.
|
|
Self-Employed Income
|
Requirements:
-
The lender must verify the existence of the borrower's business within 120 calendar
days prior to the note date
-
from a third party, such as a CPA, regulatory agency, or the applicable licensing
bureau, if possible; or
-
by verifying a phone listing and address for the borrower's business using a telephone
book, the internet, or directory assistance.
-
The lender must document the source of the information obtained and the name and title
of the lender's employee who obtained the information.
|
The table below provides references to recently issued Announcements that are related
to this topic.
