Alex Greer Borrower uses restricted stock units as income to qualify for purchase

Loan officer: Alex Greer. Property type: Single-family residence in Palo Alto. Appraisal value: $1.5 million. Loan type: Jumbo 7/1 adjustable-rate mortgage.

Loan amount: $1.125 million. Rate: 4.125 percent. Backstory: As Silicon Valley continues to grow, the divide between the lending needs of our residents and the lending options of big banks becomes more and more apparent.

More than three-fourths of all top Silicon Valley companies use Restricted Stock Units (or RSUs) as a form of compensation for their employees. Yet no big banks will allow RSUs to be counted toward a borrower’s qualifying income.

As a lifelong resident of Silicon Valley and owner of the Mortgage Outlet, I make an emphasis to tailor all of our products that we offer to meet the needs of local residents, which includes allowing RSUs to be counted toward a borrower’s qualifying income alongside their base salary.

And that is exactly what this particular borrower needed. If we only used the borrower’s base salary as qualifying income, they did not have an acceptatble debt-to-income ratio to qualify for the jumbo purchase.

But once the RSU income was factored into the qualifying income, the borrower had absolutely no debt-to-income issues because a significant portion of the borrower’s total compensation was the RSUs. To document the RSU income, the borrower only had to show that they had received the RSUs for the past year and that they would be continuing to receive them for the next three years.

Upon receipt of the executed purchase contract, the purchase loan was promptly submitted with a 748 credit score, 75 percent loan-to-value and the combination of salaried and RSU income.

The loan funded 22 days later.

Alex Greer, the Mortgage Outlet,

408-352-5147, agreer@themortgageoutlet.com.