Fannie Mae Form 1007 and Form 216 are supplemental appraisal documents a lender orders when a borrower wants to use rental income to qualify for a conventional mortgage. Form 1007, the Single-Family Comparable Rent Schedule, applies to one-unit investment properties. Form 216, the Operating Income Statement, supports the income analysis on two-to-four-unit properties and is submitted with the Small Residential Income Property Appraisal Report (Form 1025). The appraiser completes both forms, and they travel with the rest of the appraisal package through Fannie Mae’s Uniform Collateral Data Portal.1Fannie Mae. Appraisal Report Forms and Exhibits
When Each Form Is Required
Form 1007 is required when two conditions overlap: the property is a one-unit investment property, and the borrower wants rental income counted toward qualifying. If the borrower is not using rental income to qualify, Form 1007 is not required, though the lender may still order it to report gross monthly rent at delivery.1Fannie Mae. Appraisal Report Forms and Exhibits It rides along with whatever standard appraisal report the property calls for, such as the Uniform Residential Appraisal Report (Form 1004).
Form 216 comes into play for two-to-four-unit properties. It functions as the income-and-expense supplement inside the Form 1025 package. Form 1007 estimates market rent for a single unit; Form 216 captures the full operating picture of a multi-unit building, including total rents, vacancy, and expenses.
What must accompany Form 1007 depends on the borrower’s history with the property. On a purchase where the borrower has no rental history from the property, the lender needs Form 1007 plus any lease that transfers with the sale. If the property is vacant or the lease does not transfer, Form 1007 alone can support the estimate. On a refinance where the borrower has been receiving rent, the lender pairs Form 1007 with the most recent year of signed federal tax returns including Schedule E, or with current leases when a qualifying exception applies.2Fannie Mae. Rental Income
What Goes on Form 1007
The appraiser identifies comparable rental properties in the subject’s market area that have recently been leased or are currently listed. The form records each comparable’s address, proximity to the subject, unit size, bedroom and bathroom count, condition, and lease terms. The appraiser then adjusts for feature differences: garages, updated kitchens, finished basements, and utility arrangements (whether landlord or tenant pays for heat, electricity, and water). If a comparable has a feature the subject lacks, the comparable’s rent is adjusted downward, and the reverse for features the subject has and the comparable does not.
The bottom of the form produces a single figure, “Monthly Market Rent,” which represents what the subject would likely command in a typical lease. The appraiser reconciles the adjusted rents of the comparables to arrive at that number. Blank copies of the form are available from Fannie Mae’s forms page.1Fannie Mae. Appraisal Report Forms and Exhibits
What Goes on Form 216
The Operating Income Statement has three sections: income, expenses, and replacement reserves.
The income section starts with gross annual rental from the units to be rented, plus any other income the property produces. The appraiser then subtracts a vacancy and collection loss percentage. The form leaves that percentage blank rather than prescribing a fixed rate, so the appraiser picks a figure that fits the local market. Stable markets with low turnover warrant a smaller deduction; areas with seasonal demand or higher turnover justify a larger one.
The expense section itemizes:
- Utilities such as electricity, gas, fuel oil, and water and sewer
- Services such as trash removal, pest control, and casual labor for snow removal or common-area cleaning
- Maintenance, including interior paint, general repairs, and supplies like light bulbs and janitorial products
- Management fees at the rate a professional management company would charge, even if the owner plans to self-manage
- Taxes, licenses, and other miscellaneous costs
The replacement reserve schedule requires an annual reserve estimate for items with finite useful lives: stoves, refrigerators, dishwashers, air conditioning units, water heaters, furnaces, the roof, and carpeting in units and common areas. Each item gets an estimated remaining life and replacement cost, and the form calculates an annual reserve contribution. That total rolls into the expense section.
The final figure is net operating income: gross income minus vacancy loss minus total operating expenses (including replacement reserves). This is the cash flow the underwriter treats as available to cover the mortgage payment.
How the Rent Figure Translates Into Qualifying Income
When the lender uses current lease agreements or the market rent reported on Form 1007 or Form 1025, qualifying rental income equals 75% of the gross monthly rent. The other 25% is deducted automatically to cover vacancy losses and ongoing maintenance, so the underwriter does not apply a separate vacancy adjustment.2Fannie Mae. Rental Income
If the borrower has a history of receiving rent from the property, the lender may use Schedule E instead. The lender averages the annual rental income or loss over 12 months, or over the months the property was in service if it was a partial year, then adds back depreciation, interest, homeowners’ association dues, taxes, and insurance to arrive at net cash flow.2Fannie Mae. Rental Income
The 75% rule is why the Monthly Market Rent line matters so much. If the appraiser reports $2,000, the lender credits $1,500 toward the borrower’s income. A comparable selection that understates rent by $200 costs the borrower $150 in qualifying income, which can be the difference between approval and denial on a tight debt-to-income ratio.
Submitting the Appraisal and What Happens Next
Completed forms are bundled into the full appraisal report and uploaded to the Uniform Collateral Data Portal. Under current UAD 2.6 standards, the file is an XML document with an embedded PDF. Under the newer UAD 3.6 format, the file is a ZIP package containing the XML, a PDF, and an image folder with all associated photographs.3Fannie Mae. FAQs – Uniform Collateral Data Portal The loan cannot be delivered to Fannie Mae until the appraisal reaches a “Successful” status in UCDP.
Fannie Mae’s Collateral Underwriter tool then runs an automated analysis, producing a risk score along with flags and messages that highlight potential inconsistencies in the data.4Fannie Mae. Collateral Underwriter Underwriting reviews those flags and may ask for more documentation if the market rent estimates diverge from existing leases or regional trends. Current leases and bank statements showing deposit history speed up that stage.
What Changes Under UAD 3.6
Fannie Mae is moving to a single dynamic Uniform Residential Appraisal Report under UAD 3.6, replacing the current lineup of separate form numbers for different property types. The broad product period opens January 26, 2026, when lenders can begin submitting under the new format. By November 2, 2026, all lenders must use UAD 3.6 for new submissions. The legacy UAD 2.6 format retires on May 3, 2027.5Fannie Mae. Appraiser Update – April 2025
Under the new system, one adaptive report replaces Forms 1004, 1025, 1073, and others. The report’s content adjusts to the assignment type, showing only the sections relevant to the specific property and approach. The current Form 1007 and Form 216 structures may be absorbed into the dynamic report rather than remaining standalone documents, so anyone working on investment property files during the transition should watch Fannie Mae’s guidance for how rental income and operating income data will be captured.