Buying a Home With RSU Income
A large share of your compensation arrives as stock rather than salary. Vested restricted stock units are documented qualifying income, and they should be counted.
Your equity comp is income
Base salary is only part of the picture. Underwriting can see the rest.
- Restricted stock units and restricted stock employment income are accepted qualifying income on jumbo and non-agency programs.
- The stock has to be publicly traded and the units have to be vested and actually received.
- A two-year history of receipt is the standard, documented through pay stubs, W-2s, and tax returns.
- Qualifying income is calculated as an average of the last two years of RSU income plus year-to-date, applied to the number of units that vested.
- The share price used is the lower of the current price or a trailing average, so a recent run-up does not inflate your income.
- Future vesting has to support the income being used. The vesting schedule is part of the file.
Vested RSUs as qualifying income
Stock grants documented properly
Jumbo and non-agency programs
Primary, second home, or investment
Conservative share price used
Full documentation underwriting
What A Clean RSU File Contains
Five documents do most of the work. Missing any one of them stalls the file.
The issuance agreement or equivalent benefits document establishes that the grant exists. The distribution schedule shows how many units come to you and when. The vesting schedule proves the income continues. Evidence that the stock is publicly traded confirms it can actually be valued. And evidence of payout, typically a year-to-date pay stub plus two years of W-2s, proves the money landed.
From there the calculation is mechanical. Underwriting averages the RSU income you actually received over the past two years, adds year-to-date, and applies a conservative share price. Some programs use the lower of the current price or the two-year average. Others use the lower of the current price or the fifty-two-week average. Either way the intent is the same, which is to avoid qualifying you on a peak that may not repeat.
One trade-off worth knowing before you start: if you use vested RSUs as qualifying income, those same units generally cannot also count toward reserves. You have to pick a lane. On a jumbo file with meaningful reserve requirements, that choice can matter more than the income itself, and it is worth modeling both ways before submission.
Why RSU income gets mishandled
Six things that go wrong on equity compensation files.
The Lender Only Counted Base Salary
This is the most common outcome and the most expensive one. A borrower earning a substantial share of total comp in stock gets qualified as if that portion does not exist, and the loan amount comes back far smaller than it should.
Unvested Units Were Included
Unvested grants are not income. They are a promise. Every guideline that permits RSU income requires the units to be vested and received on a regular, recurring basis before the number counts.
The Company Is Not Publicly Traded
Pre-IPO equity, private company shares, and restricted stock in a closely held business do not qualify. The requirement that the stock be publicly traded is consistent across every program that allows RSU income.
The Borrower Changed Jobs
You generally have to be currently employed by the company issuing the units. A recent move to a new employer, even in the same field, complicates the two-year history requirement significantly.
Stock Options Were Treated Like RSUs
They are not the same instrument and guidelines treat them differently. A few programs allow vested options as income under strict conditions. Others list stock options as an unacceptable income source outright.
The Wrong Loan Type Was Chosen
FHA does not permit restricted stock or RSU income for qualifying at all. If a large share of your compensation is equity, the loan has to be structured on a program that recognizes it.
Hear From Homeowners Like You
Frequently Asked Questions
Questions we hear from borrowers with equity compensation.
Two years of documented receipt is the standard. One program additionally asks for five years in the same industry. There is no program in our documentation that permits less than two years, so a first-time grant recipient generally needs to wait or qualify on salary alone.
Sold and settled shares can fund a purchase like any other liquid asset, but if you are using vested RSUs as qualifying income, those same units generally cannot also be counted toward the reserve requirement. Restricted stock is broadly excluded from reserve calculations.
It will not count as qualifying income. Every program requires publicly traded stock. Once the company is public and you have a documented history of vested receipt, the picture changes.
A conservative one. Depending on the program it is the lower of the current price or a two-year average, or the lower of the current price or the fifty-two-week average for the most recent twelve months at the time of closing.
It can. Underwriting looks for a trend. If the amounts are stable or rising the two-year average is used. If the trend is clearly declining, expect a more conservative calculation and a written explanation requirement.
No. Restricted stock and RSU income are specifically listed as ineligible for qualifying on FHA. If equity comp is central to your income, conventional and non-agency programs are the path.
Yes on programs that permit RSU income and non-owner-occupied transactions. Credit score and reserve requirements run higher than for a primary residence.
Find out what you qualify for
Send us two years of W-2s, a current pay stub, and your vesting schedule. We will run the RSU calculation the way an underwriter will and tell you what it actually does to your loan amount before you start looking at houses.
Get Pre-QualifiedRSU and stock compensation income is not accepted on every loan program and is specifically ineligible on FHA financing. Documentation requirements, history requirements, and share price conventions vary by investor and are subject to change. Not all applicants will qualify. This is not a commitment to lend.