Buying a Home in San Francisco with RSUs, Stock Comp, or Bonuses

I'm Christopher Lee, San Francisco Realtor (DRE #02120811). A huge share of my buyers earn the majority of their compensation in RSUs, ISOs, NSOs, performance bonuses, or tender-offer proceeds. And the single most common misunderstanding I see is this: the way your offer letter pays you is not the way a mortgage lender counts it.

This guide is the playbook I walk every tech buyer through. It covers how each comp type is treated by underwriters, which lenders are flexible, how to document everything, and how to structure your cash to close without triggering an avoidable tax bill.

Modeling buying power with stock comp is tricky. The Buying Power Calculator is a starting point — for the real conversation, schedule a call.

How each comp type counts

The headline: in a standard underwrite, only the vested RSU history counts, averaged over 24 months. If you've been at your company 14 months, most lenders count only 14 months of vesting averaged across 24 — cutting your usable income roughly in half versus what you actually earn.

This is why lender choice matters enormously for tech buyers.

Lenders that are flexible with RSU income

In rough order of how aggressive they tend to be with stock comp:

Most flexible (count future vesting):

• Morgan Stanley Private Bank
• JPM Private Bank
• Schwab Bank
• Goldman Private Bank
• Successors to First Republic's private banking

These typically require AUM (assets under management) or are willing to onboard you. They will count RSUs vesting in the next 36 months from public, established employers (Meta, Google, Apple, Microsoft, Amazon, established mid-caps) at face value, sometimes discounted 10–20%.

Moderately flexible:

• Local mortgage banks with strong tech-buyer practices
• BofA Premier
• Wells Private Client

Standard underwrite (vested only, averaged):

• Retail jumbo lenders
• Most online lenders

If you have meaningful unvested RSUs vesting soon, a private bank conversation is usually worth the extra documentation step.

Documents you'll need

Have these ready before you apply:

1. Two years of W-2s showing RSU income on Box 1.
2. Two years of tax returns including all schedules.
3. Current pay stubs (30 days).
4. Vesting schedule from Shareworks, Carta, E*TRADE, Fidelity Stock Plan, or Morgan Stanley at Work. This must show past vests AND future vesting dates.
5. Brokerage statements for any account holding company stock or that received RSU sales (2 months).
6. Employment verification letter confirming title, start date, and base salary. Some lenders want the comp letter or recent equity grant doc.
7. For tender offers: the tender agreement, payment confirmation, and post-tender brokerage statement.

The vesting schedule is the document underwriters spend the most time on. Make sure yours shows historical vests with dates, share counts, FMV at vest, AND future vesting dates. If your equity platform doesn't show all of this on one page, screenshot multiple pages and combine into a PDF.

Cash-to-close strategy: don't liquidate without thinking

This is where I save buyers the most money.

Default mistake: sell $400K of vested RSUs to fund down payment. Trigger $120K+ in short-term and long-term capital gains. Pay an extra $35–55K in state and federal taxes you didn't need to pay this year.

Better options, in rough order:

1. Pledged-asset / securities-backed line of credit (SBLOC). Pledge brokerage assets to the bank instead of selling. You keep the position, the tax basis, and the upside. Schwab PAL, Morgan Stanley LAL, JPM Liquidity Access. See jumbo loan guide.
2. Tax-loss harvest first. If you have loss positions, sell them before year-end to offset gains from RSU sales. Net the gain.
3. Sell long-term holdings, not short-term. Long-term capital gains rates (held >1 year) are ~half of short-term. If you have a mix, pick LTCG lots.
4. Sell shares vested at the highest cost basis. Your basis is the FMV at vest. Specific-lot selection minimizes the realized gain.
5. Use bonus or upcoming vest to bridge. If a large vest hits 60 days post-close, structure cash flow accordingly — but underwriters will want to see cash today, not future income.

Christopher's Take: I've watched buyers eat $50K+ in unnecessary taxes just because nobody told them about pledged-asset lines. If you have meaningful brokerage holdings, ask your lender about SBLOCs before you sell a single share.

The "comp going down" problem

This is a real and growing issue. Several scenarios:

Your company's stock dropped 50% since your RSUs were granted. Future vests are worth less. But for underwriting, lenders use FMV at vest, not at grant — so the dollar income from past vests is locked in. Future-vesting-counting lenders will, however, use today's stock price to value upcoming vests.

Your refresher grants got cut. Disclose this on the front end. Lenders care about future income stability — they'll model on what they can see today.

You're at a private startup, not yet IPO. Private-company RSUs typically aren't counted as income at all (no liquidity). Tender offers help with cash to close but don't help with monthly DTI. You'll qualify on base + bonus only.

Your employer is in a layoff cycle. Underwriters read the news. Be ready to discuss tenure, role criticality, and any RSU acceleration in your contract.

Bonus income: what counts

For annual or performance bonuses to count toward qualifying income:

• Must have 2 years of history at the employer (or in the same role/industry, sometimes accepted)
• Lender will average across 24 months
• Sign-on bonuses are typically excluded (one-time)
• "At risk" / variable bonuses tied to company performance may get a haircut

Tip: if your bonus is paid out in March, time your loan application AFTER the bonus hits your W-2 and you have a paystub showing the YTD bonus. That captures the full prior-year bonus in the calculation.

ISO and NSO exercises

Exercising stock options doesn't automatically generate "income" for mortgage purposes — but the resulting tax event and liquidity event can both help.

• ISOs (Incentive Stock Options) — exercising creates AMT exposure but not ordinary W-2 income (unless you do a cashless exercise / same-day sale). For mortgage purposes, exercised-and-held ISOs don't add income; the eventual qualified sale gets favorable LTCG treatment.
• NSOs (Non-Qualified Stock Options) — exercising creates ordinary W-2 income on the spread (FMV minus strike). This DOES count for mortgage qualifying if reported on W-2 for 2 years.

If you're planning a large exercise to free up cash, time it carefully: the resulting W-2 spike can either help (if it lands in a year you're applying) or hurt (if a lender sees one massive year and assumes it's not repeatable).

Tender offers and secondary sales

Pre-IPO tender offers are a major liquidity event for SF tech employees. For mortgage purposes:

• As income: typically excluded. Lenders see them as one-time.
• As cash to close: absolutely usable. Document the tender agreement, the payment, and the deposit into your account. Funds need to "season" (sit in your account) at least 60 days at most lenders for the cleanest underwrite.
• As reserves: counted at full face value if liquid.

A tender right before you apply for a mortgage is one of the best possible setups: you have documented liquidity, you're not stressed about cash to close, and your base + RSU vesting still drives your DTI.

A real SF buyer scenario

Buyer: 30-year-old senior engineer at a public mid-cap tech company.

• Base salary: $220K
• 2-year average RSU vesting: $180K
• 2024 cash bonus: $40K, prior years similar
• Total comp: ~$440K
• Currently has: $350K cash, $600K in brokerage (mostly vested RSUs from current employer)

Buying a $1.6M Noe Valley condo with 20% down ($320K).

The third option keeps everything invested and triggers zero taxes. The trade-off is taking on an SBLOC alongside the mortgage — manageable for a buyer with strong cash flow, dangerous in a market drawdown if you don't have the income to pay it down.

Common mistakes I see

• Liquidating too early. Don't sell RSUs to "prepare to buy" before you've talked to a lender about pledged-asset alternatives.
• Switching jobs mid-loan. Even a lateral move with higher comp can pause your loan for 30+ days while the new income gets verified.
• Hiding bonus volatility. Underwriters will find it. Better to disclose and discuss.
• Forgetting your equity refresh. A new grant in the last 6 months is a positive signal — make sure your LO sees it.
• Not getting an underwriter conversation upfront. With complex tech comp, you want a human underwriter looking at your file BEFORE you write offers. Don't rely on automated underwriting alone.

Next steps

1. Read the Mortgage Pre-Approval Guide.
2. Read the Jumbo Loan Guide.
3. Read the First-Time Buyer Guide.
4. Run scenarios in the Buying Power Calculator.
5. Schedule a strategy call — bring your comp letter, vesting schedule, and a rough budget. We'll map the right lender and the right cash-to-close approach in one meeting.

If your income is mostly equity, your lender choice is the single most leveraged decision in your buying process. Get it right and you can buy more home with less tax friction.