RSU Income vs. Bonus vs. Commission: How Lenders See the Difference

 

Introduction

Not all income is created equal in the eyes of a mortgage lender. While salary is the most straightforward, many borrowers rely on restricted stock units (RSUs), bonuses, or commissions to boost their qualifying income. The challenge is that lenders treat each of these income types differently, applying unique rules to determine whether they count and how much weight they carry.

This article breaks down how lenders compare RSU income to bonuses and commissions, where they overlap, and where the differences matter most. If RSUs are a major part of your compensation, this will help you understand what lenders look for and how to prepare. For a broader overview of RSUs in the mortgage process, see our Guide to Using RSUs to Qualify for a Mortgage.

 

Why Lenders Care About Income Type

When lenders review a borrower’s file, they want to know two things:

1. Is the income stable and ongoing?
2. Can it be documented clearly?

RSUs, bonuses, and commissions are all considered variable income, which means they are not guaranteed in the same way as base salary. As a result, lenders apply more scrutiny and often require longer histories and more paperwork before counting them.

 

RSU Income: The Basics

RSUs are equity awards that vest over time, typically from a public company.

Lender view:

• Time-based RSUs: Require at least 12 months of vested and distributed history.
• Performance-based RSUs: Usually require 24 months of history.
• Must show proof of future continuation through a vesting schedule or employer confirmation.
• Only vested and distributed shares count — unvested awards are excluded.

Borrower takeaway: RSUs are usable if you can document a history and prove continuation, but lenders treat them cautiously.

See our blog: How Fannie Mae and Freddie Mac Treat RSU Income in 2025 for full agency guidelines.

 

Bonus Income: How It’s Treated

Bonuses are cash payments employers provide, often annually or quarterly.

Lender view:

• Require a two-year history of receiving consistent bonuses.
• Lenders average the last two years and sometimes the year-to-date bonus to project qualifying income.
• Documentation includes W-2s, paystubs, and employer verification.

Borrower takeaway: Even if your bonuses are large, they may not count unless you have a clear two-year track record.

 

Commission Income: How It’s Treated

Commission is earnings tied to performance, typically sales or business development.

Lender view:

• Like bonuses, commissions require a two-year history.
• Income is averaged over two years, with close attention paid to any fluctuations.
• Lenders want to see stability; declining commissions can reduce qualifying income.
• Documentation includes W-2s, paystubs, and tax returns (for self-employed borrowers).

Borrower takeaway: Commissions count, but lenders are wary of volatility. Consistency and strong documentation are key.

 

Comparing RSUs, Bonuses, and Commissions

Income Type	History Required	Continuation	Documentation	Risk in Lender’s Eyes
RSUs (Time-based)	12 months	Vesting schedule required	Grant letter, vesting schedule, W-2s, paystubs, brokerage statements	Moderate
RSUs (Performance-based)	24 months	Vesting schedule + employer confirmation	Same as above	Higher
Bonuses	24 months	Ongoing employer practice	W-2s, paystubs, VOE	Moderate
Commissions	24 months	Ongoing employer practice	W-2s, paystubs, tax returns	Higher if inconsistent

 

Why RSUs Are Different

Unlike bonuses and commissions, RSUs are tied to equity compensation, not cash performance. This creates unique challenges:

• RSUs must come from a publicly traded company to count.
• Stock price volatility can influence the perceived value, though lenders often use averages to stabilize calculations.
• RSUs require proof of future vesting, which is not typically required for bonuses or commissions.

In other words, RSUs can sometimes be easier to use (with just 12 months of history for time-based awards) but also riskier if the stock or employer stability comes into question.

 

Common Borrower Mistakes Across All Income Types

Regardless of whether you earn RSUs, bonuses, or commissions, borrowers often fall into the same traps:

• Not keeping documentation like grant letters or year-end bonus breakdowns.
• Assuming one year of income is enough when most variable income requires two years.
• Waiting until the last minute to gather paperwork.
• Working with lenders unfamiliar with complex income types.

See our blog: Top 7 Mistakes Borrowers Make When Using RSUs for a Mortgage for more pitfalls to avoid.

 

Broker Advantage: Why This Matters Even More with RSUs

Big banks tend to apply rigid rules when it comes to variable income. If your RSUs or bonuses don’t fit neatly into their box, they may be excluded.

Brokers, on the other hand, have access to multiple investors with slightly different interpretations of the guidelines. This flexibility can be the difference between having your RSUs counted or being forced to qualify on salary alone.

For tips on documentation, see: Documentation Checklist: Proving RSU Income for Mortgage Approval.

 

Real-World Example

Borrower A has a $120,000 base salary, $50,000 annual bonus, and $80,000 per year in time-based RSUs with two years of vesting history.

• Bonus: Counted, based on a two-year average.
• RSUs: Counted, based on vesting schedule and W-2s.
• Outcome: Borrower’s qualifying income increased significantly, enabling them to buy at a higher price point.

Borrower B has a $100,000 base salary, high commissions, and new RSUs with only six months of history.

• Commission: Counted, averaged over two years.
• RSUs: Excluded, since the history requirement was not met.
• Outcome: Borrower qualified, but for a lower loan amount.

 

Conclusion

RSUs, bonuses, and commissions all fall under the umbrella of variable income, but lenders treat them differently. RSUs can sometimes be used with just 12 months of history, while bonuses and commissions generally require two full years. Across all three income types, documentation and proof of continuation are essential.

Because interpretations vary, especially with RSUs, working with a mortgage broker can give you an edge. Instead of being limited to one bank’s rules, a broker can shop your scenario to multiple investors and find the most favorable path.

This blog is part of our RSU and mortgage series. Be sure to also read: The Future of RSUs in Mortgage Lending: What Borrowers Should Expect to see where the industry is headed.