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Conventional loans · Fannie Mae B3-6-06Buying a new home before the current one sells: when both payments count

When a buyer's current principal residence is under contract but its sale will not close – with title passing to the new owner – before the purchase of the new principal residence, Fannie Mae requires the lender to qualify the buyer with both the current home's payment (PITIA) and the new one. The current payment can be left out if the lender has two things: the executed sales contract for the current residence, and confirmation that any financing contingencies in that sale have been cleared. That is why the timing of the other buyer's loan approval matters to your buyer's purchase. If the current home will instead be kept as a second home, its payment counts as a monthly debt; if it becomes a rental, the rental income rules apply and reserves can rise. When a buyer who sold a home earlier let the purchaser assume the mortgage without a release of liability, that payment can be ignored once the purchaser has a 12-month record of timely payments.

The rule (B3-6-06)

  1. 1. Sale closes first

    Only the new payment counts – the old home is gone.

  2. 2. Sale pending, closes after

    Both payments count in the debt-to-income ratio…

  3. 3. …unless

    the lender has the executed sales contract and confirmation that the sale's financing contingencies are cleared.

If the current home is kept

  1. Second home

    Its full payment counts as a monthly debt.

  2. Rental

    Rental income rules for a departing residence apply; reserves for other financed properties may be required.

  3. Assumed by a buyer

    Without a release of liability, the payment can be excluded after 12 months of timely payments by the new owner.

  4. Divorce buyout

    Excluded once the transfer of title is documented.

What the TC can do on linked deals

  • Ask the listing side for the executed contract on the buyer's current home as soon as it is signed.
  • Track the other buyer's financing contingency date – your buyer's lender will ask when it is cleared.
  • Get written confirmation that the financing contingency is removed and send it to your buyer's lender.
  • If the sale cannot close first, ask the lender early whether the buyer qualifies with both payments.

Questions buyers ask

Do I have to qualify with two mortgage payments if my house hasn't sold?

If your current home's sale will not close before the purchase, Fannie Mae counts both payments – unless the lender gets the executed sales contract and confirmation that its financing contingencies are cleared (Selling Guide B3-6-06).

What documents remove my old house payment from qualifying?

The executed sales contract for your current residence and confirmation that any financing contingencies in that sale have been cleared.

What if I keep my current home as a rental?

Then the rental income rules for a departing residence apply, and the lender may require additional reserves for other financed properties.

Related guides

Run the sale and the purchase as two deals in ClosingCode, each with its own deadlines – the other buyer's financing date sits on the calendar next to your buyer's closing.

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Source: Fannie Mae Selling Guide B3-6-06, Qualifying Impact of Other Real Estate Owned (09/02/2026), selling-guide.fanniemae.com, read October 25, 2026.

General information about Fannie Mae conventional loans, not financial advice. FHA, VA, USDA and each lender's own overlays can differ. ClosingCode is software; it is not a lender. This guide is not a substitute for the advice or services of an attorney.