B3-3.4-03, Annuity, Pension, or Retirement Income (03/04/2026)

The following table provides requirements for annuity (government, personal, or insurance), pension, and retirement income.

Criteria	Requirements
Documentation	The lender must obtain verification of the income amount using at least one of the following: a statement from the organization providing the income, a copy of retirement award letter or benefit statement, a copy of financial or bank account statement, a copy of signed federal income tax return, an IRS W-2 form, or an IRS 1099 form. However, if the borrower will begin receiving payments from an annuity or pension account on or before the first payment date of the subject mortgage, document the income with a benefit statement from the organization providing the income. The statement must specify the income type, amount and frequency of the payment, and include confirmation of the initial start date.
Income History	Fixed Distribution or fixed payment: No minimum history is required. Variable Distribution: A minimum 12-month history of receipt is required.
Income Continuance	Insurance/personal annuity or retirement account distribution: The lender must document that income is expected to continue for at least three years from the note date. Distributions or fixed payment from a for pension: Document(s) used to support the monthly income amount may not reference the required minimum three-year continuance from the note date. In these situations, the lender must make the determination using alternative documentation such as, but not limited to, an applicable written agreement, the respective government program associated with the distribution, or information required by law or regulation related to the distribution. Note: Eligible retirement account balances (from 401(k), IRA, or Keogh) may be combined for the purpose of determining whether the three-year continuance requirement is met. The borrower must have unrestricted access to the accounts without penalty.
Determination of Qualifying Income	Fixed Distribution or fixed payment: The monthly payment amount as documented above may be used as qualifying income. Variable Distribution: Develop an average of the income received for the most recent 12 months.
DU Validation Service	If a borrower's annuity, pension, or retirement income is validated by the DU validation service, DU will issue a message indicating the required documentation. This documentation may differ from the requirements described above. See B3-2-02, DU Validation Service B3-2-02, DU Validation Service .