Peninsula Real Estate Guide
Using RSUs and Stock Compensation to Buy on the Peninsula
How tech equity actually counts toward qualifying, and what to know before you sell vested shares
|
2 Years Typical Vesting History Required |
~75% Typical Stock Value Discount |
RSUs Yes Options: Never Count as Income |
$1,249,125 Where Jumbo Financing Begins |
With Oracle, Electronic Arts, and a wide network of other tech employers within a short commute of San Carlos, Belmont, and Redwood City, restricted stock units are a real part of how many Peninsula buyers actually get paid, and often a meaningful part of how they get to a down payment. But lenders treat this income very differently than salary, and understanding the rules before you start house hunting can change your entire budget.
The Rule Most New Hires Don’t Expect
Most lenders will only count RSU income toward your qualifying income once you have roughly two years of vesting history and can show your employer is likely to keep issuing grants. A single new-hire grant, even one worth a substantial amount on paper, usually will not count at all in your first year or two at a company. That means your base salary alone, not your full compensation package, often determines your realistic budget early in a new job, which surprises a lot of buyers who assumed their offer letter’s total comp number was the relevant figure.
RSUs vs. Stock Options: Not the Same for a Lender
A Distinction That Trips Up Even Experienced Buyers
RSUs have real, guaranteed value once vested, so lenders can and often will count them as income with the right documentation. Stock options work differently, since their value depends on the strike price and exercise decision, and mortgage lenders generally will not count them as qualifying income at all, regardless of how valuable they may be on paper.
How Lenders Actually Calculate RSU Income
| Factor | Typical Lender Approach |
| Vesting history required | Roughly two years for most conventional and jumbo lenders |
| Stock value used | Often the current price, discounted to roughly 75% to account for volatility |
| Documentation needed | Vesting schedule, employer verification, pay stubs showing distributions, and prior tax returns |
| Down payment expectations | Often at least 10% on jumbo loans using RSU income, sometimes more for the strongest consideration |
Given that the 2026 conforming loan limit for San Mateo County tops out at $1,249,125, and most Peninsula purchases exceed that, RSU income frequently becomes the deciding factor in whether a buyer qualifies for the home they actually want or has to settle for a smaller budget. It is also worth knowing that FHA and VA loans do not permit RSU income at all, which rules those programs out for most tech-compensated Peninsula buyers regardless of the rest of their financial picture.
Selling Vested Shares for Your Down Payment
Many Peninsula buyers plan to sell some vested RSU shares to help fund their down payment, and the tax treatment depends entirely on how long you have held the shares since vesting. Shares held less than a year are taxed as short-term capital gains at your ordinary income rate, while shares held longer typically qualify for the more favorable long-term capital gains rate. Selling a large block of stock can also meaningfully increase your taxable income for the year, which is worth planning around with a tax advisor rather than discovering at filing time.
Key Takeaway
RSU income can genuinely expand what you qualify for on the Peninsula, but only once you have the vesting track record lenders require. Have this conversation with a lender who specializes in equity compensation before you start touring homes, not after you’ve found one.
Frequently Asked Questions
Can I use my new job’s RSU grant to qualify right away?
Usually not. Most lenders want roughly two years of actual vesting history before counting RSU income.
Do stock options count toward mortgage qualifying income?
Generally no. Lenders treat vested RSUs very differently from stock options, which are typically excluded entirely.
How much down payment do I need if I’m using RSU income?
Often at least 10% for jumbo loans, though requirements vary by lender and loan program.
Should I sell shares held less than a year for my down payment?
Consider the tax cost first. Shares held under a year are taxed at your ordinary income rate rather than the lower long-term capital gains rate.
| Related Reading | |
| A First-Time Homebuyer Guide for the Peninsula in 2026 | See how RSU-backed jumbo financing fits alongside conforming loan limits. |
| Interest Rates in 2026: What They Mean for Your Purchasing Power | Understand the other half of your monthly payment math. |
| Is 2026 a Good Time to Buy on the Peninsula? | Put your financing picture in context with current market conditions. |
| Which Peninsula City Is Right for You? | Match your qualifying budget to the right city once you know your real numbers. |
Compensated Partly in Equity?
I can connect you with lenders who specialize in RSU and equity-based income for Peninsula buyers.
Holly Noto | Coldwell Banker Realty | DRE#01244498, DRE#01908304
580 El Camino Real, San Carlos, CA 94070
650.544.6185 | [email protected]
Lending guidelines vary by lender and loan program and reflect general industry practice as of 2026. This content is not tax or lending advice; consult a licensed lender and tax advisor for your specific equity compensation situation.
