Top 7 RSU Mortgage Mistakes to Avoid in 2025

 

Introduction

Restricted stock units (RSUs) can be a powerful tool for qualifying for a mortgage, but only if they are used correctly. Many borrowers make mistakes that cause lenders to exclude their RSU income or reduce their buying power.

In this article, we’ll walk through the seven most common mistakes borrowers make when trying to use RSUs for mortgage qualification and how you can avoid them. For a complete overview of how RSUs fit into the mortgage process, see our Guide to Using RSUs to Qualify for a Mortgage.

 

Mistake 1: Not Having Enough RSU History

Lenders require a history of receipt before counting RSUs.

• Time-based RSUs: At least 12 months of vested and distributed income.
• Performance-based RSUs: At least 24 months of vested and distributed income, unless compensating factors are present.

How to avoid it: Plan ahead. If you are less than a year into your vesting schedule, your RSUs may not count yet.

See our blog: How Fannie Mae and Freddie Mac Treat RSU Income in 2025 for details on history requirements.

 

Mistake 2: Relying on Unvested RSUs

Only vested and distributed RSUs can be counted. Lenders do not include unvested stock, no matter how promising the schedule looks.

How to avoid it: Provide clear documentation showing which shares have already vested, not just what is scheduled.

 

Mistake 3: Missing Documentation

Even strong RSU income may be excluded if the paperwork isn’t there. The most commonly missing items are:

• Vesting schedules
• Grant letters
• Brokerage statements
• Employer confirmation of ongoing grants

How to avoid it: Keep copies of all equity-related paperwork and know who to contact at your company (often payroll, HR, or your stock plan administrator).

See our blog: Documentation Checklist: Proving RSU Income for Mortgage Approval for a complete list.

 

Mistake 4: Overlooking Future Continuation

Lenders not only want to see that you’ve received RSUs, they also want to know that you’ll continue to receive them. A vesting schedule that ends in six months with no new grants may lead lenders to exclude the income.

How to avoid it:

• Provide documentation showing future vesting events.
• If your company issues new annual grants, get written confirmation from HR or payroll.

 

Mistake 5: Assuming HR Will Automatically Provide Everything

One hidden obstacle borrowers face is expecting their employer’s HR or payroll department to automatically supply every RSU document needed. Large tech firms often outsource HR or payroll functions, and those teams may only provide basic pay history, not detailed equity records.

Why it’s a mistake: If you assume HR will handle it, you may find yourself scrambling when a lender asks for grant letters, vesting schedules, or confirmations of future awards. These requests often require persistence or escalation, and delays can stall your loan approval.

How to avoid it:

• Identify early who manages equity compensation at your company.
• Ask whether documents are handled by HR, payroll, or an outside administrator.
• Keep your own copies of all grant letters and schedules so you don’t rely solely on your employer.

See our blog: Documentation Checklist: Proving RSU Income for Mortgage Approval for more guidance on paperwork.

 

Mistake 6: Assuming Private Company RSUs Count

Fannie Mae and Freddie Mac require RSUs to come from a publicly traded company. Private company RSUs are generally excluded since they are difficult to value and lack liquidity.

How to avoid it: If most of your equity is in a private company, don’t assume it will count. Work with a lender who can evaluate other income sources to strengthen your file.

 

Mistake 7: Working with the Wrong Lender

Even when you meet the guidelines, not every lender treats RSUs the same way. Some lenders are more conservative, and others may simply be unfamiliar with RSU-heavy income.

How to avoid it:

• Work with a mortgage broker who has access to multiple investors.
• If one lender is overly strict, a broker can pivot to another who may interpret the guidelines more favorably.
• Avoid being locked into a single big bank’s interpretation, which can limit your options.

For a look ahead at how lender attitudes may evolve, see our blog: The Future of RSUs in Mortgage Lending: What Borrowers Should Expect.

 

Bonus Tip: Don’t Wait Until the Last Minute

Many borrowers only realize they need detailed RSU documentation when they’re already in contract on a home. By then, tracking down grant letters or vesting schedules from HR or payroll can create stressful delays.

How to avoid it: Start early. Before you begin house hunting, gather all of your RSU paperwork, verify your vesting schedule, and meet with a mortgage advisor who understands RSUs.

 

Real-World Example

Borrower A assumed that unvested RSUs would count because they were “guaranteed” to vest in the future. They provided a grant letter but no proof of vested shares. The lender excluded all RSU income, reducing their purchase power by over $300,000.

Borrower B worked with a broker early, who helped them track down grant letters, two years of W-2s, and confirmation of future grants. Their RSU income was fully counted, and they secured a loan that fit their budget comfortably.

 

Conclusion

RSUs can dramatically increase your buying power, but only if they are handled correctly. By avoiding these seven mistakes — not enough history, unvested stock, missing documents, lack of continuation, assuming HR will provide everything, private company RSUs, and working with the wrong lender — you can put yourself in the strongest position possible.

Because RSU income is still a developing area in mortgage lending, interpretations vary. That’s why working with a mortgage broker is so valuable: instead of being locked into one bank’s guidelines, you gain access to multiple investors and multiple interpretations, giving you a better chance of approval.

This blog is part of our RSU and mortgage series. Be sure to also read: Documentation Checklist: Proving RSU Income for Mortgage Approval and RSU Income vs. Bonus vs. Commission: How Lenders See the Difference.