source:
  type: guide
  id: fnma-sel-b3-2-06
  authority: Fannie Mae Selling Guide B3-2-06 — Approve/Ineligible Recommendations
  description: Fannie Mae Selling Guide B3-2-06 — Approve/Ineligible Recommendations.
  coverage_tier: operative
obligations:
- id: fnma-sel-b3-2-06-full
  canonical_id: fnma-sel-b3-2-06-full
  section: Fannie Mae Selling Guide B3-2-06 — Approve/Ineligible Recommendations
  type: do
  tags:
  - regulator-direct
  - fnma
  - selling-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Fannie Mae Selling Guide B3-2-06 — Approve/Ineligible Recommendations
    source_class: fnma-guide
    source_url: https://singlefamily.fanniemae.com/media/document/pdf/selling-guide
    snapshot_id: 5f7b8b79da595d76
    fetched_at: '2026-05-25T14:09:57Z'
    content_hash: sha256:98cf85a02861bbe84914a0e339b327c8fc131869a8a573882007bbeea60c5701
    paragraph_quote: 'B3-2-06, Approve/Ineligible Recommendations (02/01/2023) Introduction
      This topic contains information on Approve/Ineligible recommendations. Overview
      of Approve/Ineligible Recommendations Lender Response to an Approve/Ineligible
      Recommendation Overview of Approve/Ineligible Recommendations Loan caseﬁles
      may receive an Ineligible recommendation for a variety of reasons, including:
      The loan does not comply with stated product requirements or policies that apply
      to DU loans in this Guide; or The loan complies with stated product requirements
      or policies, but has a combination of product features or risk factors that
      place the loan outside of Fannie Mae''s current acquisition preferences and
      constraints for DU loans. Published May 6, 2026 290 The lender must determine
      if the reason for the ineligibility creates an additional layering of credit
      risk that should be considered as the lender makes the underwriting decision.
      The following table provides further information about these recommendations.
      Approve/Ineligible Eligible for Fannie Mae’s limited waiver of certain mortgage
      eligibility and underwriting representations and warranties? No (see A2-2-04,
      Limited Waiver and Enforcement Relief of Representations and Warranties) Satisﬁes
      Fannie Mae’s credit risk standards/assessment? Yes Satisﬁes Fannie Mae’s mortgage
      loan eligibility criteria? No, the loan does not meet Fannie Mae''s stated eligibility
      requirements for DU loans, or the combination of product features and risk factors
      place the loan outside Fannie Mae''s current acquisition preferences and constraints
      for DU loans. Eligible for sale to Fannie Mae? Yes, if the lender satisﬁes at
      least one of the following criteria: • The lender has negotiated terms (such
      as variances, exceptions, or special requirements) that speciﬁcally permit the
      sale of the loan as a DU loan. • The lender manually underwrites the loan in
      accordance with this Selling Guide if the loan product or transaction otherwise
      allows for sale of manually underwritten loans. See B3-1-01, Comprehensive Risk
      Assessment and the Eligibility Matrix for appropriate eligibility requirements
      and considerations. Lender Response to an Approve/Ineligible Recommendation
      When a loan caseﬁle receives an Approve/Ineligible recommendation, the lender
      should: Review the DU loan data for accuracy and verify that all income, assets,
      and liabilities were accurately recorded and fully disclosed by the borrower.
      Determine if there is any information outside of the data submitted to DU that
      could have aﬀected DU''s recommendation. In some cases, updating information
      may resolve the issue that resulted in the ineligibility. For example, if the
      loan is ineligible due to a combination of product features or risk factors
      that Published May 6, 2026 291 place the loan outside of Fannie Mae''s current
      acquisition preferences and constraints, the borrower may provide documentation
      of additional income to lower the debt-to-income ratio or provide a larger down
      payment to lower the LTV ratio. Update the loan application data (if applicable)
      and resubmit the loan caseﬁle to DU for an updated recommendation. If the loan
      caseﬁle still receives and Approve/Ineligible recommendation, the lender may
      manually underwrite the loan in accordance with the requirements in the table
      above. Recent Related Announcements The table below provides references to recently
      issued Announcements that are related to this topic. Announcements Issue Date
      Announcement SEL-2023-01 February 01, 2023 Announcement SEL-2021-08 September
      01, 2021 Announcement SEL-2020-04 August 05, 2020'
  judgment: false
