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CPA Letter for Conventional Mortgage Fannie Mae Freddie Mac: Step-by-Step Script for Borrowers and Loan Officers

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CPA Letter for Conventional Mortgage Fannie Mae Freddie Mac_ Step-by-Step Script for Borrowers and Loan Officers

For many borrowers, especially those who are self-employed, one of the most uncomfortable parts of the mortgage process is figuring out cpa letter for conventional mortgage fannie mae freddie mac. Mortgage lenders often want extra verification that your income is legitimate, your business is active, and your financial records match what’s on your application.

 

Loan officers experience this problem from the other side as well: they know exactly what underwriters need, but borrowers aren’t always sure what to tell their accounting firm.

 

This guide explains exactly how to approach your CPA, what information they will need, how to make the request professionally, and provides ready-to-use email scripts for borrowers and Mortgage Loan Officers (MLOs).

 

Why Mortgage Lenders Request CPA Letters

New to this? First understand what lenders expect from a conventional-mortgage CPA letter before you request one.

Underwriter Verification Requirements

In today’s lending environment, whether it’s a conventional mortgage lender, an FHA / VA / USDA lender, or a portfolio lender, underwriters often need confirmation of:

  • Business activity
  • Income stability
  • Years of self-employment
  • Accuracy of tax returns and financial statements
  • Ownership structure of the business

This applies when the borrower runs a company, operates as a sole proprietor, or uses merchant processors like PayPal, Stripe, Square, or Shopify to receive business income.

 

When Automated Systems Flag the File

Even if Desktop Underwriter (Fannie Mae) or Loan Product Advisor (Freddie Mac) approves the loan, underwriters sometimes want additional comfort, especially if bank statements, Profit & Loss statements, or bookkeeping records show fluctuations.

 

A CPA letter gives them confidence, but only if it’s written under proper AICPA ethics, state board standards, and with the right disclaimers.

 

Before You Ask Your CPA: What You Must Prepare

Your CPA will only issue a letter after verifying certain facts. To avoid back-and-forth delays, prepare the following:

 

Your Basic Mortgage Information

  • Lender name
  • Type of loan (Conventional, FHA, VA, USDA, or portfolio)
  • Purpose (purchase or refinance)
  • Your Mortgage Loan Officer’s contact information

 

Your Financial Documents

Your CPA may need access to:

  • IRS tax returns / transcripts
  • Business tax returns (Forms 1120, 1120-S, 1065)
  • Personal tax returns (Form 1040)
  • P&L statement, balance sheet, and year-to-date financials
  • Business bank accounts and personal bank accounts
  • Invoices, receipts, and merchant statements (Stripe, PayPal, Square, Shopify)
  • Bookkeeping records or accounting software data

 

Business Legal Documents

If you are self-employed through a business entity:

  • Articles of Incorporation / Organization
  • Business license
  • Operating agreement (LLC)
  • EIN documentation

 

Authorization Forms

Some accounting firms require:

  • Written authorization
  • A signed engagement letter
  • A small service fee

This protects them legally under AICPA guidelines.

 

CPA Letter for Conventional Mortgage Fannie Mae Freddie Mac (Step-by-Step)

 

Step 1, Email, Don’t Call

Accounting firms operate on documentation, not verbal promises. Sending a written email ensures:

  • The request is logged
  • The CPA can assign it to the correct accounting staff
  • The firm knows exactly what the lender needs
  • You avoid miscommunication

 

Step 2, Be Clear About the Lender’s Requirements

Explain what type of letter your lender needs:

  • CPA Letter
  • Comfort Letter
  • Verification Letter
  • Self-Employment Verification
  • Business Activity Verification

Underwriters do not want CPAs to estimate or project income. They only want factual confirmation.

 

Step 3, Provide All Documentation Up Front

Send your CPA:

  • Lender’s sample letter
  • Underwriter’s conditions
  • Bank statements
  • P&L or bookkeeping reports

The cleaner your package, the faster your CPA responds.

 

Step 4, Request the Letter Within Ethical Limits

CPAs must follow professional standards. They cannot:

  • Predict future income
  • Guarantee profitability
  • State anything they cannot verify

This protects both you and your CPA legally.

CPA Letter for Conventional Mortgage Fannie Mae Freddie Mac (Step-by-Step)

 

Email Script Templates (Borrowers & Loan Officers)

 

Script 1, Borrower Requesting a CPA Letter

Subject: Request for Mortgage Verification Letter

 

Hi [CPA Name],

I hope you’re doing well. I am in the process of applying for a mortgage, and my lender has requested a CPA verification letter to confirm my self-employment status and the accuracy of my financial records.

 

Attached are the lender’s conditions and the sample letter they provided. I’ve also included my recent P&L, bank statements, and any documents that may help your review.

 

Please let me know if you need additional bookkeeping records, merchant statements (PayPal, Stripe, Square), or tax information.

 

Thank you for your help with this, please advise on the next steps, authorization forms, and your fee for preparing the letter.

 

Warm regards,

[Your Name]

 

Script 2,  Mortgage Loan Officer Requesting a Letter on Behalf of Borrower

Subject: Verification Request for Borrower Applying for a Mortgage

 

Hi [CPA Name],

I’m working with our mutual client, [Borrower Name], on their mortgage application. To complete underwriting, we need a CPA letter confirming business activity, years of self-employment, and any financial documentation you have prepared.

 

Attached are the underwriting conditions and a sample letter format.

We greatly appreciate your assistance and can answer any questions you may have.

 

Best,

[Loan Officer Name]

[Company + NMLS Number]

 

What Your CPA Can and Cannot Say in the Mortgage Letter

Allowed (Factual Statements)

  • Years of self-employment
  • Entity type and ownership
  • Whether the CPA prepared the tax returns
  • Whether financial statements were prepared by the CPA
  • Whether the business is active

 

Not Allowed (Due to AICPA Standards)

  • Predictions of future income
  • Guarantees of business stability
  • Statements they cannot independently verify
  • Misleading assurances to the lender

A properly structured letter protects the CPA’s license and your mortgage application.

Tips for Getting Your CPA Letter Faster

  • Send your request early, accounting firms are busiest during tax season.
  • Provide clean financial documents.
  • Ask your MLO to give you a copy of exactly what the underwriter wants.
  • Avoid rushing your CPA; quality verification takes time.

A respectful approach goes a long way — when you are ready to move forward, follow the complete how to get a CPA letter process to prepare your documents and submit your request correctly the first time.

 

Tips for Getting Your CPA Letter Faster

Conclusion:

Getting a mortgage as a self-employed borrower can feel overwhelming, but a well-written CPA letter can smooth the process dramatically, especially when income varies, bookkeeping is complex, or merchant accounts process revenue in different ways.

 

When you approach your CPA with clarity, organization, and the right documentation, the entire process becomes simpler and much faster. Understanding cpa letter for conventional mortgage fannie mae freddie mac ensures your request is professional, compliant, and easy for your CPA to fulfill.

Frequently Asked Questions

Do Fannie Mae and Freddie Mac require a CPA letter for every self-employed borrower?

No. Fannie Mae and Freddie Mac do not universally require a CPA letter for self-employed borrowers. Their guidelines require lenders to verify specific facts — business ownership, years of self-employment, and active operating status — but how those facts are verified depends on the underwriter’s findings. When Desktop Underwriter (DU) or Loan Product Advisor (LPA) flags a file for additional business verification, the lender typically requests a CPA letter as the most efficient way to satisfy those conditions. Borrowers with clean tax returns, consistent income, and no AUS flags may not be asked for one at all.

 

What does a Fannie Mae or Freddie Mac underwriter actually do with a CPA letter?

The underwriter uses the CPA letter to clear specific conditions flagged by the automated underwriting system — typically business activity verification, ownership confirmation, or years-in-business documentation. The letter does not replace tax returns. Fannie Mae and Freddie Mac require tax returns as the primary income documentation for self-employed borrowers. The CPA letter sits alongside the tax returns to confirm the business context behind the numbers — that the business is active, that the CPA prepared the returns, and that the ownership structure matches what the borrower reported on the application. Underwriters cross-reference the CPA’s statements directly against the submitted tax returns before clearing the condition.

 

What information does a CPA include in a Fannie Mae or Freddie Mac comfort letter?

A CPA letter for a conventional GSE loan typically confirms: the borrower’s years of self-employment, the legal structure of the business (LLC, S-Corp, C-Corp, Partnership, or Sole Proprietorship), the borrower’s ownership percentage, whether the business is currently active and operating, and whether the CPA prepared or reviewed the borrower’s tax returns and financial statements. The letter does not include predictions of future income, guarantees of business stability, or any statement implying an audit was performed unless one actually was. Under AICPA professional standards, CPAs are limited to confirming factual information within their direct scope of knowledge — nothing more.

 

Why do Fannie Mae underwriters request a CPA letter when the borrower already submitted tax returns?

Tax returns confirm what a borrower reported to the IRS — they do not independently confirm that the business is still active, that the CPA relationship is ongoing, or that the ownership structure matches what is stated on the loan application. A CPA letter fills those specific gaps. When Desktop Underwriter generates a condition to verify self-employment or business activity, a CPA letter is the most direct way to satisfy it because the CPA can confirm facts that no tax form directly states — such as whether the business is currently operating, how long the CPA has worked with the borrower, and whether the bookkeeping records align with the filed returns. The letter supplements the tax returns — it does not replace them.

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