RSU Income Calculator for Mortgage
Estimate the annual income from your RSUs that lenders may use for mortgage qualification.
Enter the total pre-tax value ($) of all vested RSU shares you received in the past 24 months.
Lenders often use a percentage (50-100%) of your RSU income. 75% is a common figure.
Enter the total number of RSUs that are granted but have not yet vested.
The current market price of a single share of your company’s stock.
Your Qualifying RSU Income
$0.00
This is the estimated annual income from RSUs a lender might use for your mortgage application.
2-Year Average Annual RSU Income
$0.00
Potential Future Value (Unvested)
$0.00
Income Comparison
What is an RSU Income Calculator for Mortgage?
An RSU (Restricted Stock Unit) income calculator for mortgage is a specialized tool designed to help you estimate how much of your RSU compensation a mortgage lender might count as qualifying income. Unlike a regular salary, RSU income is variable and subject to vesting schedules and stock price fluctuations, which makes lenders treat it with more caution. This calculator applies a common methodology used by lenders—averaging historical income and applying a discount—to give you a realistic figure for your home-buying journey.
This tool is essential for tech employees, executives, and anyone whose compensation package includes significant equity. Understanding your qualifying RSU income can drastically change your perceived purchasing power and help you set a more accurate home budget. For more information on debt-to-income ratios, which are critical in this process, see our guide on the debt-to-income ratio calculator.
RSU Qualifying Income Formula and Explanation
Lenders need to ensure your income is stable and likely to continue. For RSUs, they typically look at your history of receiving this income. The core formula this calculator uses is:
Qualifying Annual Income = (Total Vested RSU Income in Last 24 Months / 2) * (Lender Discount Percentage / 100)
This formula averages your RSU income over a two-year period to smooth out stock price volatility and then applies a “haircut” or discount to account for future uncertainty.
Variables Table
| Variable | Meaning | Unit | Typical Range |
|---|---|---|---|
| Total Vested RSU Income | The gross, pre-tax value of all RSU shares that vested and were delivered to you over the past two years. | Currency ($) | $10,000 – $1,000,000+ |
| Lender Discount Percentage | The percentage of your average RSU income that a lender is willing to consider as stable. | Percentage (%) | 50% – 100% |
| Qualifying Annual Income | The final estimated annual income figure that can be used on a mortgage application. | Currency ($) | Varies based on inputs |
Practical Examples
Example 1: Established Tech Employee
An employee at a large, publicly traded tech company has a solid history of RSU vesting.
- Inputs:
- Total Vested RSU Income (24 mo): $150,000
- Lender Discount: 75%
- Calculation:
- Average Annual Income: $150,000 / 2 = $75,000
- Qualifying Income: $75,000 * 0.75 = $56,250
- Result: The lender would likely add $56,250 to their annual income for qualification purposes.
Example 2: Newer Employee or Volatile Stock
An employee has a shorter track record, or their company’s stock is highly volatile. The lender may be more conservative.
- Inputs:
- Total Vested RSU Income (24 mo): $80,000
- Lender Discount: 60%
- Calculation:
- Average Annual Income: $80,000 / 2 = $40,000
- Qualifying Income: $40,000 * 0.60 = $24,000
- Result: In this case, only $24,000 of their RSU income might qualify, significantly impacting their borrowing power. Understanding this is easier with a mortgage pre-approval calculator.
How to Use This RSU Income Calculator
- Enter Your 2-Year RSU History: Find your pay stubs or brokerage statements and add up the total pre-tax value of all RSUs that vested in the last 24 months. Enter this into the “Total Vested RSU Income” field.
- Adjust the Lender Discount: Start with the default 75%. If you know your lender is more conservative or aggressive, adjust this value. Some specialist lenders might go up to 100% for strong candidates.
- Add Future Potential: Input your unvested shares and the current stock price to see the potential future value. While not used for qualification, this helps understand your overall financial picture.
- Review Your Results: The calculator instantly displays your “Qualifying Annual Income.” This is the number to discuss with your mortgage advisor. The chart and intermediate values provide additional context.
Key Factors That Affect RSU Income Qualification
Lenders analyze several factors beyond the raw numbers. Being aware of these can help you prepare your application. Considering Fannie Mae RSU guidelines can be beneficial.
- History of Receipt: Most lenders, following Fannie Mae guidelines, require a minimum of 1-2 years of RSU income history to consider it stable.
- Company Status: Income from a large, stable, publicly-traded company is viewed far more favorably than from a private startup.
- Vesting Schedule: A consistent, ongoing vesting schedule suggests income continuance. If your grants are about to end, a lender may not count the income without proof of new grants.
- Stock Volatility: For highly volatile stocks, lenders may use a lower average stock price or a larger discount percentage to mitigate risk.
- Income Type (Time vs. Performance): Time-based RSUs are more predictable and often require less history (e.g., 12 months) than performance-based RSUs, which may need 24 months of history.
- Documentation: You will need to provide comprehensive documentation, including grant letters, vesting schedules, and brokerage statements showing the distributions.
Frequently Asked Questions (FAQ)
Generally, no. Lenders will only consider income from RSUs that have already vested and been paid out. Unvested shares represent potential future income and are not guaranteed.
Lenders discount RSU income to protect against stock market volatility and the risk that the income may not continue. A stock’s value can drop, reducing your future income, so they use a conservative approach.
Some lenders may accept a 12-month history, especially for time-based RSUs from a stable employer. However, a two-year history is the standard and significantly strengthens your application.
Not always. Many lenders will count the income based on your vesting history alone. However, showing a history of liquidating the shares and using the cash can strengthen your case. Some lenders may require you to sell vested shares.
The value is based on the market price of the stock on the day it vested. Lenders will use historical data from your statements to determine this value over the required period. Some may use a 52-week or 200-day average price to smooth out fluctuations. If you have questions about this, check our article on stock option income for mortgage.
Be prepared to provide your RSU grant agreements, vesting schedules, and brokerage statements for the last two years showing the vested shares and their value. You will also need standard documents like W-2s and paystubs.
This calculator is specifically for RSUs. Stock options (ISOs, NSOs) are treated differently by lenders and have a more complex valuation. You can learn more in our guide on stock options.
Not directly. However, by increasing your total qualifying income, RSU income can improve your debt-to-income (DTI) ratio, which can help you qualify for a larger loan and potentially better terms.