An employer's stock grant isn't automatically monthly mortgage income. Restricted stock compensation can be usable when the distributions, history, award type and calculation satisfy the program. Unvested future value is a different thing from income already vested and delivered.
Have the equity compensation reviewed before deciding how much house the full compensation package can support. A recruiter offer or benefits dashboard may overstate the amount usable today.
Separate the grant from the distribution
A grant promises compensation under its terms. Vesting establishes when the employee earns the rights. Distribution delivers shares or cash. Those events may occur on different dates.
Under Fannie's current rule, the restricted stock used as income must have vested and been distributed without restrictions. Restricted stock sign on bonuses that vest over time are excluded from qualifying income under that provision.
Ask the lender to identify the actual type of award. A recurring employment award and a one time hiring incentive shouldn't be treated as identical simply because both appear as RSUs.
History depends on the award type
Fannie requires at least 12 months from the current employer for time based awards. For performance based awards, two years is recommended, with a permitted shorter history of at least 12 months when the specified positive factors support it.
Continuance also differs. A one time based award requires a documented vesting schedule continuing at least three years from application. Recurring and performance awards have different continuance treatment when there's no reason to expect cessation.
These rules don't mean every employee with one vesting event can qualify. The lender must identify the category and supporting records. Other investors and lender programs may differ.
Share price matters even when the number of shares is clear
For qualifying Fannie compensation paid in shares, the stated method uses the 200 day moving average share price and distributed vested shares, generally over the most recent 24 months. Cash paid compensation uses its corresponding pretax distribution history. A permitted 12 to 24 month history uses the actual months received.
The current stock price and the original grant price aren't automatic substitutes. The method is designed to use the documented history and required value measure.
This is a qualifying calculation, not a projection of where the stock will trade after closing.
Work through the share calculation
Hypothetical example: 1,200 pretax vested shares were distributed over the applicable 24 month period and the supported 200 day average price is $50. Multiplying 1,200 by $50 gives $60,000. Dividing by 24 gives $2,500 monthly before any additional required analysis.
If the current stock price is $75, using it instead would produce $90,000 divided by 24, or $3,750 monthly. That would overstate this example's formula by $1,250.
Assume base qualifying income is $10,000 and total obligations are $6,100. With $2,500 of eligible stock income, DTI is $6,100 divided by $12,500, or 48.8%. With the unsupported $3,750 figure, it would appear about 44.4%. The incorrect valuation could change the apparent approval. Neither ratio independently guarantees a result.
Send documents that connect the same story
The lender needs the required employment income records, vesting schedule, distribution evidence and stock price support. Public trading eligibility matters under the Fannie provision.
Check that the records distinguish gross shares distributed from shares withheld or sold for taxes. A net deposit doesn't always equal the pretax compensation amount. A brokerage account's current holdings may also omit shares that vested and were sold.
Provide the payroll and brokerage records that reconcile the distribution rather than asking the underwriter to infer the entire history from one account balance.
A job change can alter the analysis
Moving to a new employer can change vesting, history and award type. A large new package may not replace usable income from an established prior pattern under the selected rule.
Tell the lender about the change before resigning if a purchase is underway. Job change qualification explains the broader employment question, while this page addresses the equity component specifically.
Don't assume an unvested make whole grant at the new company counts the same as previously distributed recurring compensation. The terms and history need a fresh review.
Income and assets must be analyzed for their separate uses
Once vested shares are owned, their eligible net value may also be relevant to down payment or reserves under asset rules. The lender must distinguish prior compensation records from current assets and future support for continuing income.
Selling shares for closing doesn't create a second stream of recurring employment income. Future vesting and the remaining compensation structure must support the income conclusion independently. Brokerage assets explains the closing source side.
Get the income figure before choosing the payment
Ask for the award classification, eligible history, pretax distributions, valuation method, qualifying amount and unresolved continuance conditions. Then review the proposed payment using base income with and without the stock component.
That gives you a realistic purchase budget and shows how dependent the approval is on equity compensation. The right number is the one the documented award supports, not the largest value displayed in the compensation portal.
Common questions
Can unvested RSUs be used?
Only future vesting on a clear schedule, backed by a history of past vesting.
Does the stock price matter?
Yes. Lenders often use a conservative value.
Do I need two years of RSU history?
Often yes.