By Ziya Y. · 23 Years Banking · Public agency guidelines + typical market overlays · May 2026
Lenders can add their own rules — called overlays — on top of federal agency guidelines. Understanding the difference between agency standards and typical lender overlays is key to knowing where to apply.
This guide covers agency guidelines (sourced from public federal documents) and typical overlay categories (representing common market ranges, not specific named lenders).
Enter your profile — see which loan categories you'd likely qualify for.
| Category | Type | Min Credit | Max DTI | SSDI Income | 1099 Income | Physician |
|---|---|---|---|---|---|---|
| Fannie Mae (Agency Standard) Public guideline: Fannie Mae Selling Guide (fanniemae.com) |
Agency | 620+ | 50% | ✅ 25% gross-up | ✅ 24mo history | ✅ |
| Freddie Mac (Agency Standard) Public guideline: Freddie Mac Seller/Servicer Guide (freddiemac.com) |
Agency | 620+ | 50% | ✅ 25% gross-up | ✅ 24mo history | ✅ |
| FHA (HUD Standard) Public guideline: HUD Handbook 4000.1 (hudexchange.info) |
Government | 580+ | 57% | ✅ 15% gross-up | ✅ 24mo history | — |
| VA Loan (Standard) Public guideline: VA Lender's Handbook Chapter 4 (benefits.va.gov) |
Government | 580+ | 41% | ✅ 25% gross-up | ✅ 24mo history | — |
| USDA Rural (Standard) Public guideline: USDA HB-1-3550 (rd.usda.gov) |
Government | 640+ | 41% | ✅ 25% gross-up | ✅ 24mo history | — |
| Conservative Bank Overlay (Typical) Represents typical conservative lender overlay. Actual requirements va |
Typical Overlay | 640+ | 45% | ✅ 15% gross-up | ❌ Not accepted | ✅ |
| Moderate Bank Overlay (Typical) Represents typical moderate lender overlay. Actual requirements vary b |
Typical Overlay | 620+ | 50% | ✅ 25% gross-up | ✅ 24mo history | ✅ |
| Flexible Non-Bank Overlay (Typical) Represents flexible non-bank lender overlay. Actual requirements vary |
Typical Overlay | 600+ | 55% | ✅ 25% gross-up | ✅ 12mo history | ✅ |
| Physician Loan Program (Typical) Typical physician loan program terms. MD/DO/DDS/PharmD. Offer letter a |
Physician Specialty | 700+ | 55% | ❌ Not accepted | ❌ Not accepted | ✅ |
| Bank Statement Loan / Non-QM (Typical) 12-24 months bank statements. 50% expense factor typical. Higher rate |
Non-QM | 660+ | 55% | ✅ 25% gross-up | ✅ 1mo history | — |
| DSCR Investor Loan (Typical) No income verification — rental income covers PITI. Investment propert |
Non-QM | 680+ | 999 (N/A) | ❌ Not accepted | ❌ Not accepted | — |
| Asset Depletion (Typical) Assets / 360 months = qualifying income. High net worth borrowers. |
Non-QM | 680+ | 45% | ❌ Not accepted | ❌ Not accepted | — |
| Credit Union (Typical) Credit unions often follow agency guidelines closely. Member benefits |
Credit Union | 620+ | 50% | ✅ 25% gross-up | ✅ 24mo history | — |
| Portfolio Lender (Typical) Portfolio lenders hold loans on own books. Most flexible — manual unde |
Portfolio | 600+ | 55% | ✅ 25% gross-up | ✅ 12mo history | ✅ |
Federal agencies (Fannie Mae, FHA, VA) publish minimum guidelines. Lenders can — and usually do — add stricter requirements called overlays. Examples:
This is why the same borrower can be approved by one lender and denied by another — even with the same loan program. Overlays are the hidden variable most borrowers never see.
Find your loan category above, then talk to lenders in that category. Always ask: "Do you have any overlays above agency guidelines for [SSDI / 1099 / physician loans]?" A lender who can't answer this question clearly is a red flag.
Agency guidelines: Fannie Mae Selling Guide (fanniemae.com), Freddie Mac Seller/Servicer Guide, HUD Handbook 4000.1, VA Lender's Handbook, USDA HB-1-3550. Typical overlay ranges based on 23 years of mortgage industry experience and publicly available industry research. Last updated: May 28, 2026. Not financial advice.