Your compensation may include salary and restricted stock units, often called RSUs. If the stock is a significant part of what you earn, leaving it out of a mortgage calculation could understate your finances. But a grant notice that promises future shares is not automatically the same as income a lender can count today.
For certain conventional loans, qualifying RSU income depends on actual vesting and distribution, a documented history, the type of award, and evidence about future awards. The calculation also depends on whether the employer pays in shares or cash. A lender needs more than the value shown in a workplace benefits portal.
The Thomas Faille Mortgage Team can review the salary, vested stock, and other compensation in your complete financial picture. This guide explains the questions to prepare for when applying for a home purchase or refinance.
What are RSUs, and when do they become income?
An employer may grant a specified number of restricted stock units that vest over time or after performance conditions are met. Before vesting, those units are generally subject to restrictions. After vesting and distribution, the employee may receive shares or cash equivalent under the award’s terms.
Fannie Mae’s restricted stock employment income guidance says restricted stock used as qualifying income must have vested and been distributed to the borrower without restrictions. That is a crucial difference between a grant worth a large amount on paper and a recurring compensation history the lender can verify.
The same Fannie Mae section says sign-on bonuses in restricted stock that vest over any period are not eligible as qualifying income under that policy. A borrower with a large new-hire grant should not assume its scheduled vesting can be added to the salary on a mortgage application. Other programs may have different rules, but the team must evaluate the actual product being offered.
The type of award and its history matter
Some grants vest mainly with continued service. Others depend on performance conditions. The distinction can change the evidence needed to establish that the income is stable.
Under Fannie Mae’s current guide, a time-based award requires at least 12 months of history from the current employer. For a performance-based award, a two-year history is recommended; a shorter history of at least 12 months may be considered with specified positive factors. The guide also distinguishes a one-time time-based award from recurring awards when evaluating whether the income can continue.
Those are guidelines for a particular conventional lending channel, not a general promise that 12 months always guarantees approval. The lender will look at the pattern of actual distributions, upcoming vesting, employer documentation, borrower stability, and the full loan file.
If you switched employers recently, bring records from both jobs. Do not assume old employer stock and a new employer’s promised stock will be treated as one uninterrupted stream. The award terms and actual receipt need review.
Documents to gather before preapproval
An RSU file can require more documentation than a salary-only file. Under the Fannie Mae guide, the lender may need a verification of employment showing stock distributions, or a recent paystub showing receipt of the income together with two years of W-2s. It also calls for evidence that the stock is publicly traded, a current vesting schedule showing past and future vesting, a 200-day moving average price when paid in shares, and a brokerage or bank statement showing prior distributions and at least the number of vested shares or cash equivalent. Employment verification also applies.
Before meeting with the mortgage team, gather:
- Award agreements and a current vesting schedule for each relevant grant.
- Payroll statements and W-2s showing how compensation was reported.
- Brokerage statements documenting actual vested distributions.
- Employer documentation distinguishing time-based, performance-based, recurring, and sign-on awards.
- Details of any stock sale or transfer into a bank account if those proceeds will be used at closing.
The lender may request more or fewer records based on its program and file. If the equity portal does not produce a clear history, ask the employer or plan administrator how to obtain a statement that separates grants, vested distributions, and shares still restricted. Do not send screenshots with unclear dates and hope they will substitute for full records.
The Faille Team’s documentation overview explains the broader application stage. Providing the stock records early gives the underwriter time to determine which income, if any, can be counted.
How a lender may calculate monthly RSU income
The mortgage calculation is not simply the current stock price multiplied by all your unvested units. Under Fannie Mae’s guide, for awards paid in shares, the calculation uses the 200-day moving average share price multiplied by the total number of vested shares distributed before tax in the most recent 24 months, divided by 24. For awards paid in cash, it uses the pretax cash distributed in the most recent 24 months divided by 24. When there is an acceptable 12-to-24-month history, the guide permits use of the actual number of months received instead of 24.
As a simplified illustration, assume a borrower received 400 eligible vested shares over 24 months and the applicable 200-day moving average was $50 per share. The formula would produce $20,000 over 24 months, or about $833 per month before the lender’s full review. The current market value of shares that have not vested would not simply be added to that figure.
This is only an example of one program’s calculation. An underwriter still needs to determine whether the award and borrower meet the history, documentation, and continuance requirements. A recent surge in stock price does not necessarily produce the same qualifying income that an online brokerage balance suggests.
RSU income and stock assets are different questions
A borrower may have vested shares in a brokerage account. They may be relevant in two separate ways. First, past qualifying distributions may potentially count as employment income under the selected program. Second, shares already owned may be eligible assets for down payment, closing costs, or reserves under applicable asset rules.
Do not count the same concept twice in your personal planning. An income calculation based on historical distributions does not mean every future share is guaranteed. And a large brokerage balance does not automatically become monthly income. The team can determine how the particular assets and compensation will be documented for the mortgage.
If you plan to sell shares for your down payment, discuss the timing before moving money. The lender may need statements showing ownership, sale proceeds, and transfer to the account used for closing. Potential taxes and trading restrictions are separate matters to discuss with a tax or financial professional.
Why future vesting still matters
Even when the income calculation looks backward at shares already distributed, the lender may review the future vesting schedule. For example, Fannie Mae requires a one-time time-based award to be expected to continue for at least three years from the application date. Its treatment of recurring time-based and performance-based awards differs as set out in the guide.
A vesting schedule with no future awards after a near-term date may weaken an income-continuance case. Conversely, a new grant alone does not replace the required receipt history. The lender considers both the record of what you actually received and the rules for whether that compensation appears likely to continue.
Report material changes during the application. If you leave the employer, an award is canceled, or an expected vesting changes, tell your loan officer immediately. Conditional approval still depends on the lender verifying the information used to qualify the loan.
What if your RSU income cannot be counted?
The mortgage team may still be able to qualify you using salary and other documented income. You might adjust the price range, down payment, debts, or timing of the purchase. If you expect future distributions to create a usable history, ask when a new application would be meaningfully different rather than guessing.
Different loan programs and lenders can evaluate compensation differently. However, never assume another program will count a stock grant exactly as you do. Ask for a written, property-specific comparison of the available loan programs, along with a comfortable payment that does not depend on the stock price rising.
The goal is a mortgage you can manage from stable resources. Stock-based compensation can fluctuate, and company shares can lose value. It is sensible to budget for home maintenance and emergencies without treating every scheduled future vest as cash already in your account.
Questions to ask your mortgage professional
- Is my award time-based, performance-based, or a sign-on grant under the selected rules?
- How much stock has actually vested and been distributed to me?
- Does my history meet this program’s minimum requirements?
- What does the future vesting schedule need to show?
- How will shares and cash-settled awards be calculated?
- Can my vested stock also be used toward closing or reserves, and what statements are required?
- What changes if I switch jobs or my next vesting date is after closing?
- What loan amount qualifies using base pay alone?
If the seller expects a fast closing, ask the lender how long it may take to obtain employer verification and brokerage records. A detailed stock-compensation file can be straightforward when started early and stressful when discovered after an offer is accepted.
Frequently asked questions
Can unvested RSUs count as mortgage income?
Fannie Mae’s restricted-stock income policy requires shares or cash to have vested and been distributed without restrictions. A future grant shown in a benefits portal does not satisfy that test by itself. The lender also reviews history and other criteria.
Do RSUs have to be from a publicly traded company?
The cited Fannie Mae policy requires evidence that the stock is publicly traded. Other products may evaluate private-company compensation differently, but availability and documentation need direct lender review.
Can I use a new-hire RSU sign-on bonus to qualify?
Not as qualifying restricted-stock income under the cited Fannie Mae policy, which excludes sign-on bonuses received in restricted stock that vest over any period. Ask whether your base pay and other eligible income support the loan.
Do I have to sell the shares to count income?
The cited Fannie Mae calculation addresses vested shares that have been distributed, with documentation of receipt. It does not state that every distributed share must be sold for the income calculation. Selling shares to fund closing is a separate asset-documentation question.
Can my stock price falling affect my approval?
Potentially. For share-settled income under Fannie Mae’s guide, the calculation uses a 200-day moving average stock price, and lenders also consider the rest of the file. Tell your lender about significant changes and ask it to update the qualifying figures rather than relying on an old estimate.
Get the stock records reviewed before shopping
The useful number for a home search is the income the selected lender can document, not the maximum value displayed in a company portal. Share the award terms, actual distributions, future schedule, payroll records, and brokerage statements before you choose a price target.
The Thomas Faille Mortgage Team, operating under Novus Home Mortgage, NMLS #423065, can review the file and discuss suitable financing. Contact the team to start a mortgage assessment using your actual compensation records.
This article provides general information as of October 2026, not tax, investment, or financial advice or a commitment to lend. Lender overlays, program availability, and current guidelines determine how stock compensation is treated in a specific application.
