Schedule E rental income
For established rentals, tax-return cash flow often controls instead of simply taking 75% of the current lease.
Fannie cash-flow analysis
When the property is appropriately reported on Schedule E, Fannie calculates net rental cash flow using the tax return and allows specified add-backs such as depreciation, interest, HOA dues, taxes and insurance before dividing by the applicable number of months.
Months in service matter
Certain recently acquired, converted or renovated properties can be averaged over the documented months actually in service instead of automatically dividing by 12.
Freddie
Freddie similarly uses Schedule E for established non-subject rental property and allows lease-based calculation only in specified circumstances, such as when the property is not yet reflected on the applicable tax return or qualifying service interruptions occurred.
Official guide baseline
Fannie Mae Selling Guide · Freddie Mac Seller/Servicer Guide
Rental-income rules are transaction-, property-, ownership-history- and management-experience-specific. Current guide controls.