Social Security, pension and disability income can be used to qualify when the lender verifies the amount and receipt and, where the income can end, documents that it will continue for at least three years. Fannie Mae and Freddie Mac generally do not require continuance documentation for Social Security retirement or long-term disability benefits, while FHA relies on the Notice of Award and treats benefits with no expiration date as likely to continue. VA lists pension and disability among other effective income and treats VA disability as a benefit that needs no continuance documentation.
Fannie Mae (conventional)
- Social Security income needs no minimum history. For retirement or long-term disability benefits on the borrower's own work record, continuance need not be verified unless there is reason to doubt it; other scenarios need three-year continuance from the note date. Fannie Mae B3-3.4-15
- An SSA award letter may document the income, including payments that begin on or before the first payment date of the new mortgage. Fannie Mae B3-3.4-15
- The lender need not document that 15% of Social Security income is nontaxable; grossing up more than 15% requires supporting documentation. Fannie Mae B3-3.4-15
- Fixed pension or annuity payments need no minimum history, while variable distributions need 12 months. If pension documents do not show three-year continuance, the lender decides it from alternative documentation. Fannie Mae B3-3.4-03
- Long-term disability income (other than Social Security) requires evidence of at least one payment on or before the first payment due date; re-evaluation of benefits is not a reason to doubt continuance. Fannie Mae B3-3.4-09
Freddie Mac (conventional)
- Retirement income needs no history of receipt. Social Security retirement benefits need no additional continuance documentation; an insurance-company annuity with a defined term must be documented to continue at least three years. Freddie Mac 5305.1(m)
- Long-term disability income, including Social Security disability, may be considered to have a reasonable expectation of continuance without additional documentation unless a pre-determined insurance or benefit expiration date is less than three years away. Freddie Mac 5305.1(h)
- Newly established long-term disability income must start on or before the first Mortgage payment due date, with a limited exception for short-term benefits converting to long-term. Freddie Mac 5305.1(h)
- No evidence of tax-exempt status is required for 15% of Social Security income, including retirement and disability benefits. Freddie Mac 5305.1(r)
FHA
- The lender must verify receipt of Social Security income and that it is likely to continue at least three years from case number assignment. FHA 4000.1 II.A.4.c.xii(H)
- If the Notice of Award has no defined expiration date, the income must be treated as likely to continue and no further continuance documentation may be requested; a future start date makes it effective only from that date. FHA 4000.1 II.A.4.c.xii(H)
- Pension payments must be verified and likely to continue for at least three years. FHA 4000.1 II.A.4.c.xii(H)
- Disability income expiring within three years of application cannot be used. The lender may not ask about the nature of the disability or the borrower's medical condition. FHA 4000.1 II.A.4.c.xii(A)
VA
- Pension or other retirement benefits and disability income may be effective income when documentation supports the history of receipt and continuance for at least 3 years from the anticipated closing date. VA Pamphlet 26-7, Ch. 4 Topic 2.r
- VA disability income is considered a benefit and need not be documented for likelihood of continuance; the COE generally lists the amount. VA Pamphlet 26-7, Ch. 4 Topic 2.r
- Tax-free income such as disability retirement payments may be grossed up, at 125 percent, for the debt-to-income ratio only. VA Pamphlet 26-7, Ch. 4 Topic 9.f
The VA Lender's Handbook in Strata has no separate section on Social Security income; its general rule for other income types is the closest text.
Sources
- Fannie Mae Selling Guide, September 2, 2026 version: B3-3.4-15, Social Security Income (p. 355, 356); B3-3.4-03, Annuity, Pension, or Retirement Income (p. 337, 338); B3-3.4-09, Long-term Disability Income (p. 348)
- Freddie Mac Single-Family Seller/Servicer Guide, September 16, 2026 version: 5305.1(m), Retirement income requirements (p. 5305-64); 5305.1(h), Long-term disability income requirements (p. 5305-10, 5305-12); 5305.1(r), Tax-exempt income requirements (p. 5305-38)
- FHA Single Family Housing Policy Handbook 4000.1, August 12, 2026 version: II.A.4.c.xii(H)(1), Social Security Income (TOTAL) (p. 238); II.A.4.c.xii(H)(2), Pension (TOTAL) (p. 239); II.A.4.c.xii(A), Disability Benefits (TOTAL) (p. 233)
- VA Lender's Handbook (VA Pamphlet 26-7), August 12, 2026 version: Chapter 4, Topic 2.r Other Types of Income (PDF p. 90, 91); Chapter 4, Topic 9.f Debt-to-Income Ratio – Item 44 (PDF p. 119, 120)
Agency guides set the baseline; individual lenders can add stricter overlays. Sources are the guideline versions in Zeitro Strata as of October 29, 2026.
