Less buying power due to rise in interest rate. Any lenders who consider RSUs for mortgage limit??

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dUsv34

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dUsv34
Yesterday 23 Comments

My banker just told me I can only afford up to $3.4M purchase price, down from $3.75M a month ago. Perfect example of reduced affordability which could be a headwind to house prices.

This is primarily since interest rates have gone up and I have reached the 43% debt limit (based on my base and bonus).

Does any major bank consider invested RSUs as income to determine mortgage limit? More than half of my salary is in RSUs.

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TOP 23 Comments
  • Meta
    otHF64

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    otHF64
    If your affordability has been reducing with price increases maybe you’re overstretching? I’ve been reducing my purchase/offer price as well with rise in rates but that’s because I don’t want to cross a certain monthly payment threshold but not because my bank says I no longer qualify at my initial max price.
    Yesterday 0
  • That 43% is the absolute ceiling. You should be aiming around 30-35%. Does that work out with your stock? When counting stock, take into the account when they sell your stock to cover taxes and you pay tax on its appreciation from initial award date. In a recession, you can’t even touch your stocks so you really really need a healthy DTI. also consider what your situation looks like on 1 income instead of dual
    Yesterday 6
    • Meta
      otHF64

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      otHF64
      Well I’m a girl interested in guys but I think the same thing applies. Room Nate situation isn’t ideal :/ the other option is affordable town homes I guess with larger down payment. Rent usually doesn’t cover mortgage in seattle but I’ll try to get a place in a good neighborhood in good schools. Or skip all of this and wait a few more years and just hope it works out financially. Ideally I’d find a place with a mil unit I can rent out.
      4h
    • I don’t think townhome will appreciate the same unless relocation is very very desirable. To be honest with you, it maybe ok to have roommates as a girl. I did when I was dating my husband and I would just spend a lot of time at his place. He had his own place. That worked well. We then decided to get a place together
      4h
  • Yes but only if vested. Otherwise it’s like telling the bank “yeah one day I’ll be rich, just wait”

    It’s not guaranteed income
    Yesterday 1
    • eBay
      dUsv34

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      dUsv34
      OP
      I meant unvested rsus. Vested rsus are just the same as stock holdings (subject to some level of insider trading restrictions).
      Yesterday
  • eBay
    dUsv34

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    dUsv34
    OP
    Total household comp is 800k in current market conditions.
    Yesterday 1
  • New
    vAYm02

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    vAYm02
    Try KeyBank…they might have 45 or 50% DTI on their Jumbos. I got 50% via a speciality Physician program so it is doable.

    They and Loan Depot would also take RSUs as long as you had a 2 year schedule, 3 years of future grants, and proof that they are an annual grant.
    Yesterday 0