An underwriter is analyzing a self-employed borrower's loan application. The borrower has been self-employed for seven years and has provided the most recent year's tax returns, which show a stable income. According to Fannie Mae guidelines, which of the following is the most accurate assessment of the provided documentation?
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A
The underwriter may accept one year of tax returns since the borrower has been self-employed for more than five years.
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B
Two years of tax returns are always mandatory for self-employed borrowers, regardless of their history.
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C
The borrower must provide an audited profit and loss statement in lieu of a second year of tax returns.
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D
Bank statements for the past 24 months can be substituted for the second year of tax returns.