Pre-IPO Equity Holder Mortgages

Pre-IPO equity holder mortgage from a lender who reads private grants, 83(b) elections, secondary liquidity, and the qualifying paths that actually work.

Pre-IPO equity holders carry the most frustrating compensation file in corporate America for a mortgage application: a base salary that’s often well below market, a meaningful equity stake in a private company on a 409A valuation that generally does not qualify as income under standard Fannie Mae and Freddie Mac rules, ISO and NSO grants with AMT exposure and 83(b) election decisions, sometimes founder shares with Section 1202 qualified small business stock (QSBS) treatment, occasional liquidity from tender offers or secondary marketplaces, and a long wait for IPO that may or may not happen. Generalist lenders see the base salary, hear "private company stock," and decline. We read the grant detail, the 409A history, the tender-offer record, the asset position, and the actual qualifying paths that work for pre-IPO files: base-only conventional, asset-depletion Non-QM, pledged-asset against publicly-traded portfolio, bank-statement against tender deposits, and specialty Non-QM with 409A acceptance.

Talk to Our Team See how qualifying works

Broker NMLS #1072866 · Specialist in pre-IPO equity, founder, & private-company executive mortgages

No 200-day MA

Private companies have no public stock price; Fannie Mae cannot calculate qualifying RSU income

$15M / 100%

QSBS Section 1202 federal capital gains exclusion (5-year hold, post-July 2025 OBBBA rules)

30 days

Strict deadline to file 83(b) election after early exercise of stock options

Specialist who reads your private grant detail & finds the qualifying path that works

Founder reviewing equity documents at desk

Stairway Mortgage qualifies pre-IPO equity holders using the paths that actually work — not by pretending private RSUs will count when they generally won’t. An early Series B employee with mostly equity and below-market salary, a late-stage tech employee with significant tender-offer proceeds sitting in a brokerage account, a founder with QSBS-qualified stock approaching the 5-year hold threshold, and a post-IPO transitioning employee within their 180-day lockup each get qualified using the methods that fit their actual liquid position and W-2 line. We pick the right door before we quote. Or skip ahead: browse every loan program, run numbers on 100+ mortgage calculators, or check today's rates. For the parent hub and other executive paths, see our corporate executives mortgage hub.

01 · Pre-IPO equity holder mortgage at a glance

Key facts every pre-IPO equity holder should know before applying for a mortgage.

Private ≠ income

Under Fannie Mae Selling Guide B3-3.1-01, RSU income requires a publicly traded stock price for the 200-day moving average. Private-company RSUs, ISOs, and NSOs generally do not qualify as income for conventional mortgages.

409A vs market

Private companies establish a stock price via IRC Section 409A valuations every 12 months. The 409A valuation governs tax treatment but is not accepted as a public stock-price proxy by Fannie Mae or Freddie Mac for income qualification.

QSBS $15M

Founders and early employees with C-corp stock issued for 5+ years may qualify for IRC Section 1202 QSBS federal capital gains exclusion up to $15M or 10× basis (post-July 2025 OBBBA rules). Asset-depletion mortgages tap accumulated QSBS proceeds.

30-day 83(b)

Early-exercise of options requires filing an IRC Section 83(b) election within 30 days — strict deadline. Locks in current FMV for AMT and starts the long-term capital gains holding clock for ISO.

02 · Where you are in your pre-IPO equity journey

Pre-IPO equity holder mortgage solutions for every stage.

Each pre-IPO stage has its own qualifying logic. An early Series A employee has a different mortgage path than a late-stage employee post-tender-offer, and both differ from a founder approaching IPO.

Early-stage employee (Series A–B)

"Series A startup. Salary below market. Lots of options, no liquidity yet."

Base $90K–$180K, often below market for the role
ISO/NSO option grants with low strike price, no realized value yet
Qualifies on base salary alone; option income unavailable
Conventional conforming with co-borrower income often required

See early-stage employee mechanics

Late-stage employee (Series C–E)

"Late-stage growth company. Salary at market. Tender offers periodic."

Base $180K–$300K + private RSU grants + occasional tender liquidity
Tender proceeds accumulating in brokerage account support asset-depletion
Bank-statement Non-QM works if tender deposits are recurring enough
Pledged-asset using publicly-traded portion of portfolio

See late-stage employee mechanics

Pre-IPO key executive

"VP/SVP at late-stage company. Large unvested equity. IPO 12-24 months out."

Base $250K–$500K + meaningful private equity stake
Asset-depletion or pledged-asset against accumulated liquidity
Specialty Non-QM lenders sometimes accept 409A-valued equity at heavy discount
Wait-for-IPO strategy often makes sense if 12-month window achievable

See pre-IPO executive mechanics

Founder / equity-heavy holder

"Founder or co-founder. Modest salary. Significant founder shares with QSBS potential."

Below-market salary by design; majority of wealth in founder shares
QSBS Section 1202 hold period 5 years for 100% exclusion
Asset-depletion against post-secondary or partial-exit proceeds
Bank-statement against advisor consulting income, if applicable

See founder mechanics

Post-IPO lockup transition

"Company just IPO’d. 180-day lockup active. Stock about to trade liquid."

Base + accumulating IPO RSU vest but no 12-month public history yet

Post-IPO RSU income requires 200-day MA which doesn’t exist yet

Time the mortgage 12-15 months post-IPO to capture public-RSU qualifying

See C-Suite Executive sub-page for post-public C-suite mechanics

See post-IPO transition mechanics

03 · The qualification mechanics

How we calculate qualifying income for your pre-IPO equity holder mortgage.

Four methods cover almost every pre-IPO file we’ve closed. The right method depends on your liquidity position, accumulated wealth, and whether your private equity has had any secondary or tender-offer events.

Method 1 — Base W-2 only (the early-stage default)

For early Series A-B employees and founders with no realized equity income. Qualifies on base salary alone under standard Fannie Mae B3-3.1-01. The private equity stake is acknowledged in the file but doesn’t add to qualifying income. Conventional conforming and conventional jumbo both work at this tier. Co-borrower income (spouse W-2, professional income) often the difference between conforming and the target home.

Method 2 — Asset-depletion against accumulated liquid wealth

For late-stage employees and founders who have realized meaningful liquidity through tender offers, secondary marketplace sales (Forge, EquityZen, Carta CrossTrade), partial-exit proceeds, or QSBS-qualified sales. Under Fannie Mae B3-3.1-09, liquid assets amortized over 360 months produce implied monthly qualifying income. For $3M in liquid reserves, that’s $8,300/month. Specialty Non-QM lenders extend the calculation further. This is the dominant qualifying path for wealth-rich pre-IPO holders.

Method 3 — Bank-statement against tender or partial-sale deposits

For late-stage employees with recurring liquidity events deposited to bank account. Under CFPB Reg Z’s Ability-to-Repay rule, non-QM bank-statement programs qualify based on actual cash deposits with an expense-ratio adjustment (typically 50–75% counting). When a company does annual tender offers and the executive participates, the recurring deposit pattern can support meaningful qualifying income that simply isn’t captured by W-2.

Method 4 — Pledged-asset against publicly-traded portfolio

For pre-IPO equity holders with a separate publicly-traded portfolio — whether from prior company equity, inheritance, or post-tax investment. Pledged-asset loans use the publicly-traded securities as collateral, often with $0 down. Critical: the private-company equity itself cannot serve as pledge collateral because it has no liquid market price. Only publicly-traded portfolio qualifies. We model the loan-to-value scenarios carefully because a stock-price drop can trigger margin calls.

04 · What generalist underwriting misses

The wealth most lenders fail to capture on a pre-IPO equity holder file.

Six wealth components that show up consistently on pre-IPO files and that generalist lenders typically either ignore or mis-categorize. Each one is documentable; the lender just needs to be willing to look past the W-2 line.

Tender offer proceeds (the big one)

Late-stage private companies often run annual tender offers allowing employees to sell a portion of vested equity to the company or to outside investors. The proceeds — often $200K–$5M+ per cycle for senior employees — deposit into the brokerage or bank account. Generalist lenders see these as "one-time" but with a multi-year history, the recurring tender pattern qualifies as continuing liquidity supporting asset-depletion under Fannie Mae B3-3.1-09.

Secondary marketplace sales

Forge Global, EquityZen, Carta CrossTrade, and other secondary marketplaces facilitate the sale of private-company equity to accredited investors. Under SEC Rule 506 private placement framework, these are documented secondary transactions. The proceeds support asset-depletion or bank-statement qualifying. Many lenders are unfamiliar with the secondary market mechanics; we document the transaction history.

QSBS Section 1202 sale proceeds

Founders and early employees with C-corp stock held 5+ years may qualify for IRC Section 1202 QSBS federal capital gains exclusion. Post-July 2025 OBBBA rules: $15M or 10× basis cap, 100% exclusion at 5-year hold, tiered exclusion 3-5 years. QSBS-qualified proceeds appear in liquid net worth supporting asset-depletion underwriting. We document the QSBS qualification with the tax advisor.

409A valuation as wealth anchor (not income)

Private companies establish an annual fair market value via IRC Section 409A valuation. The 409A FMV anchors option strike prices, AMT calculations on ISO exercise, and 83(b) election spreads. It does not qualify as a public stock-price proxy for Fannie Mae income calculation. But it does document the equity stake’s presumed value for reserves and net-worth purposes — supporting the broader file strength.

Early-exercise + 83(b) election value

Employees who early-exercised options and filed an IRC Section 83(b) election within the 30-day window own actual stock (not options) with a holding-period clock running. This positions them for QSBS qualification (if applicable), favorable LTCG rates on future sale, and reduced or eliminated AMT exposure on the original spread. The 83(b)-elected stock is documented wealth on the file.

Founder consulting / advisor income

Many founders and senior pre-IPO executives also serve as advisors or consultants to other startups, generating 1099 income alongside their primary W-2. With a two-year history, the 1099 advisor income qualifies as self-employment income under Fannie Mae B3-3.3-02. We pull the Schedule C if filing as sole proprietor or the 1099s if not, alongside primary W-2.

05 · Match the program to your pre-IPO stage

Which loan program fits your pre-IPO equity holder mortgage situation.

Seven loan-program categories cover essentially every pre-IPO file we’ve closed. The mix skews dramatically toward asset-depletion, pledged-asset, and bank-statement Non-QM at the wealth-tier end, with base-only conventional for early-stage employees.

Asset-Depletion Non-QM

Late-stage employees and founders with $1M+ liquid reserves
Assets amortized over 360 months as implied income
Dominant path for wealth-rich pre-IPO holders

Best for: Wealth-rich pre-IPO holders

Conventional Jumbo (base-only)

Pre-IPO executives qualifying on base + spouse co-borrower
10–20% down, $766,550–$2M loan range
Private equity acknowledged but not counted as income

Best for: Late-stage exec on base alone

Bank-Statement Non-QM

Late-stage employees with recurring tender or secondary deposits
12 or 24 months of personal deposits at 50–75% counting
Rate 0.5–1.0% higher than conforming

Best for: Tender-offer regulars

Pledged-Asset Loan

Pre-IPO holders with separate publicly-traded portfolio
Public securities pledged as collateral; private equity does NOT qualify
Often $0 down via securities lien

Best for: Public-portfolio holders

Specialty Non-QM (409A acceptance)

Some Non-QM lenders accept 409A-valued private equity at deep discount
Typical 50–70% LTV haircut on 409A value
Highly relationship-driven; limited lender pool

Best for: Senior pre-IPO without other liquidity

Conventional Conforming (base-only)

Early-stage employees with base income at conforming limit or below
5–20% down, loan limits up to $766,550 (FL) for 2024-25
Spouse co-borrower often essential at this stage

Best for: Series A-B early employees

Post-IPO Transition Bridge

Company just IPO’d, 180-day lockup, RSU income not yet qualifying
Bank-statement Non-QM or asset-depletion until 12-month public-vest history
Plan to refinance to conventional jumbo once public-stock history matures

Best for: Post-IPO lockup period

06 · Why this mortgage is fundamentally different

The pre-IPO equity mortgage in context: 6 forces shaping how pre-IPO holders qualify.

The reason a generalist lender struggles with a pre-IPO file isn’t laziness. It’s that pre-IPO equity exists in a structural gap between public-company executive comp (which Fannie Mae and Freddie Mac have written rules for) and small-business owner comp (which has its own Schedule C / S-corp rules). Pre-IPO sits in the middle and has neither framework apply cleanly.

Force 1 — The 200-day moving average blocker

For RSU income calculation, Fannie Mae uses the 200-day moving average of the underlying stock price; Freddie Mac uses the 52-week average. Both methods require a publicly traded stock price for a comparable lookback period. Private companies have no such price — only 409A valuations updated annually or upon material events. This is the fundamental blocker: without a public stock price, the standard RSU income calculation cannot run.

Force 2 — The 409A valuation framework

Under IRC Section 409A, private companies must establish a "fair market value" for their stock at least annually (or upon material events) for tax-compliance purposes. The 409A valuation governs option strike prices, AMT calculations on ISO exercise, and 83(b) election spreads. Fannie Mae and Freddie Mac don’t accept 409A FMV as a public stock-price substitute for income qualification, but specialty Non-QM lenders sometimes do at a 50–70% LTV haircut.

Force 3 — Tender offers and secondary marketplaces

Late-stage private companies increasingly facilitate periodic liquidity via tender offers (company-organized) or secondary marketplaces (Forge Global, EquityZen, Carta CrossTrade). Under SEC Rule 506 private placement rules, these are accredited-investor-only secondary transactions documented through formal closing processes. Proceeds deposit to the executive’s bank or brokerage account and become qualifying assets for asset-depletion or bank-statement mortgages.

Force 4 — AMT exposure on ISO exercise

Exercising incentive stock options (ISO) creates an Alternative Minimum Tax preference item: the spread between the strike price and the current FMV. Under IRS Topic 427, ISO exercise produces no regular tax but may trigger substantial AMT in the year of exercise. Early exercise + timely 83(b) election can reduce or eliminate AMT exposure by locking in the spread when FMV is closer to (or equals) strike. The AMT credit can be recovered in subsequent years against regular tax liability.

Force 5 — QSBS Section 1202 wealth potential

Under IRC Section 1202 (as amended by the July 2025 OBBBA legislation), founders and early employees with C-corporation stock held for 5+ years can exclude up to $15M or 10× their adjusted basis in federal capital gains, whichever is greater. Post-OBBBA tiered exclusions: 50% at 3 years, 75% at 4 years, 100% at 5+ years. QSBS-qualified proceeds appearing in a borrower’s brokerage account support asset-depletion underwriting and reflect substantial wealth accumulation often invisible on the W-2.

Force 6 — The 180-day post-IPO lockup transition

When a private company IPOs, employee equity remains restricted for typically 180 days post-IPO (the SEC-customary "lockup period"). During lockup the equity is publicly priced but cannot be sold. Post-lockup, the equity begins trading liquid. RSU income calculation under Fannie Mae rules requires the 12-month vest history with public stock price — meaning post-IPO RSU income generally doesn’t qualify for conventional underwriting until 12-15 months after the IPO. This is the bridge period covered by post-IPO transition mortgages.

07 · The mortgage shifts as your company matures

Pre-IPO equity holder mortgage by company stage.

A timeline view of how the right mortgage program changes as your pre-IPO company progresses from early Series A through late-stage to IPO and post-IPO public trading.

Series A–B

Early-stage employee

Comp profile: $90K–$180K base (often below market), ISO/NSO grants with low strike, no realized equity value. Dominant qualifying method: Base salary only; spouse co-borrower frequently essential. Common purchase: $350K–$650K primary residence. Watch-out: Private equity is acknowledged in the file but doesn’t qualify as income — the W-2 line is the qualifying line. Consider early-exercise + 83(b) to position for QSBS later.

Series C–E

Late-stage employee with tender liquidity

Comp profile: $180K–$300K base + private RSU grants + occasional tender-offer or secondary-marketplace proceeds. Dominant qualifying method: Bank-statement Non-QM against recurring tender deposits, or asset-depletion against accumulated proceeds. Common purchase: $700K–$1.2M primary residence. Watch-out: Tender proceeds must show multi-year pattern to qualify as continuing liquidity, not one-time event.

Pre-IPO

Pre-IPO key executive or founder

Comp profile: $250K–$500K base + meaningful private equity stake + IPO 12-24 months out. Dominant qualifying method: Asset-depletion against accumulated post-tax wealth, pledged-asset against publicly-traded portfolio, or specialty Non-QM with 409A acceptance. Common purchase: $1.2M–$2.5M primary residence. Watch-out: If IPO is imminent (3-6 months), waiting 12-15 months post-IPO for clean conventional jumbo qualifying may be better than locking in Non-QM rates now.

Post-IPO lockup

Post-IPO transition window

Comp profile: Base + accumulating RSU vest with public stock price + 180-day lockup active. Dominant qualifying method: Bank-statement Non-QM or asset-depletion until 12-month public-vest history matures (typically 12-15 months post-IPO). Common purchase: $1.5M–$3.5M primary residence. Watch-out: The lockup period is also when stock prices are most volatile — coordinate timing with sell-strategy. Post-IPO refinance to conventional jumbo once vest history matures.

08 · What pre-IPO equity holders say

What pre-IPO equity holders say about their Stairway pre-IPO mortgage.

Names abbreviated for client privacy. Company names anonymized. Numbers are real.

"Series D engineer at a late-stage SaaS company. Participated in three annual tender offers totaling $1.6M deposited to my brokerage account. The big bank said private RSUs don’t count and offered $640K based on my base salary alone. Jim’s team structured an asset-depletion file against the tender proceeds. Approved at $1.45M for an Aventura condo."

Vikram K.

Series D engineer with tender history · Aventura

"Co-founder of a private B2B SaaS company. Modest $190K salary by design. Founder shares approaching 5-year QSBS threshold. Sold a small portion via Forge Global to qualify a mortgage. Two banks couldn’t structure the file. Jim used the Forge proceeds as part of asset-depletion plus my consulting 1099 income on the side. $1.1M close on a Hollywood Hills home."

Sara M.

Co-founder, private B2B SaaS · Hollywood

"Company IPO’d 4 months ago. Still in lockup. Vested RSU income exists but no 12-month public history yet for Fannie Mae. The first lender said come back next year. Jim used my pre-IPO bank-statement history showing the salary deposits plus pledged-asset against my non-company brokerage portfolio. $1.8M close on a Coconut Grove townhome. Refinanced to conventional jumbo 14 months post-IPO."

Trevor B.

Post-IPO lockup transition · Coconut Grove

09 · Pre-IPO equity mortgage FAQs

Pre-IPO equity holder mortgage questions, answered.

More pre-IPO equity holder mortgage resources at Stairway

Can my private-company RSU income count toward my mortgage qualification?

Generally no under standard Fannie Mae and Freddie Mac rules. RSU income qualification requires a publicly traded stock price for the 200-day moving average calculation under Fannie Mae B3-3.1-01. Private equity has no such price — only 409A valuations. Specialty Non-QM lenders sometimes accept 409A-valued private RSUs at a heavy haircut (50–70% LTV), but conventional lenders do not.

My company does annual tender offers. Can I qualify on those proceeds?

Yes, in two ways. (1) Bank-statement Non-QM looks at the actual cash deposits from tender proceeds with a 12-24 month lookback. With a multi-year pattern of annual tenders, the deposits qualify as continuing liquidity. (2) Asset-depletion underwriting amortizes the accumulated tender proceeds (sitting in your brokerage account) over 360 months for implied monthly income under Fannie Mae B3-3.1-09.

I sold equity through Forge or EquityZen. Can those proceeds qualify?

Yes. Under SEC Rule 506, Forge Global, EquityZen, and Carta CrossTrade transactions are documented secondary sales of private-company stock. The proceeds deposit to your bank or brokerage and qualify for asset-depletion or bank-statement Non-QM underwriting. We document the secondary transaction history for the underwriter.

What is QSBS and how does it affect my mortgage?

QSBS — Qualified Small Business Stock under IRC Section 1202 — allows founders and early employees with C-corp stock held 5+ years to exclude up to $15M or 10× basis (post-July 2025 OBBBA rules) of federal capital gains from sale. QSBS-qualified sale proceeds add substantially to your liquid net worth, supporting asset-depletion mortgage qualification. The mortgage itself doesn’t care about QSBS specifically — but the wealth that QSBS preserves matters greatly.

What is the 83(b) election and why does it matter?

An IRC Section 83(b) election is a 30-day filing made after early-exercise of options or restricted stock. It elects to be taxed on the current FMV-vs-strike spread immediately, rather than waiting until vesting. For ISO, this can reduce or eliminate AMT exposure if FMV approximately equals strike at exercise. For NSO, it locks in current ordinary income treatment. It starts the LTCG holding clock and positions the stock for potential QSBS qualification. The 30-day deadline is strict.

What about AMT on ISO exercise?

Exercising incentive stock options creates an AMT preference item under IRS Topic 427: the spread between strike price and current FMV becomes alternative-minimum-taxable income for that year, even though no regular tax applies. For a typical late-stage exercise this can be $100K-$1M of AMT exposure. Early exercise + 83(b) election when FMV ≈ strike often eliminates the AMT issue. The AMT credit can be recovered against regular tax in future years.

My company just IPO’d. When can I use my new RSU income?

Two timing wrinkles. (1) The 180-day post-IPO lockup means you can’t actually sell shares; vest events accumulate but no liquidity until lockup ends. (2) Fannie Mae 200-day moving average needs ~200 trading days of public stock price history — meaning post-IPO RSU income generally doesn’t qualify until 12-15 months post-IPO. During the window: bank-statement Non-QM or asset-depletion bridges the gap.

Can I use my private equity as collateral for a pledged-asset loan?

No. Pledged-asset loans use publicly-traded securities as collateral — the bank needs a liquid market price to value the collateral and execute a margin call if needed. Private equity has no liquid market and therefore can’t serve as pledge collateral. Only publicly-traded portfolio (from prior employers, inheritance, post-tax investing) qualifies. Pledged-asset is great when you have public stock but the private-company equity sitting on your cap table cannot serve this purpose.

I’m a founder with below-market salary. How do I qualify?

Three main paths. (1) If you have post-tax wealth from any source (prior company exits, inheritance, family wealth), asset-depletion qualifies on the liquid assets. (2) If you do consulting or advisory work on the side, the 1099 self-employment income with a two-year history qualifies under Fannie Mae B3-3.3-02. (3) If your founder stock has had any partial-sale liquidity, the proceeds support asset-depletion. Founder mortgages are very file-specific.

My spouse is a W-2 employee with regular income. Does that help?

Significantly. Co-borrower files combine both spouses’ income. For founders and early employees with below-market salaries, the spouse’s standard W-2 income is often the difference between conforming and the target home. We document both W-2s, the founder’s 1099 if applicable, and assets jointly.

My company is pre-revenue but well-funded. What if it doesn’t IPO?

Mortgages qualify on current verifiable income and assets — not on speculative future events. If the company never IPOs, your mortgage doesn’t change. The wait-for-IPO strategy is purely about timing the qualifying window when public-stock RSU income becomes available; if it doesn’t happen, the asset-depletion and bank-statement paths remain available.

What documentation do I need to provide?

Typically: two years of W-2s, two years of full federal 1040s with all schedules, ISO/NSO/RSU grant letters (all active grants), recent 409A valuation report, 83(b) election filings if applicable, tender-offer or secondary-sale closing statements, brokerage statements for any publicly-traded portfolio, bank statements showing tender or secondary deposit history, Schedule C if consulting on the side, and current paystubs.

Are mortgage rates different for pre-IPO equity holders?

The base rate is what it is for the loan program. But pre-IPO files often route to Non-QM programs (asset-depletion, bank-statement) which carry 0.5–1.0% rate premium versus conforming. For base-only conventional qualifying, the rate matches any other conforming or jumbo file at the same credit profile.

What about company-issued retention bonuses or cash LTIP at pre-IPO companies?

If they appear on your W-2 with a two-year history, they qualify as variable income under Fannie Mae B3-3.1-01 the same way they would at a public company. Pre-IPO companies often add retention cash bonuses precisely because the equity has no liquidity; the cash component sometimes ends up being a substantial qualifying-income line that wouldn’t exist at a public company.

If my company is about to IPO, should I wait or buy now?

Depends on timing certainty and your urgency. If IPO is 3-6 months out with high confidence, waiting 12-15 months post-IPO captures public-stock RSU qualifying income (potentially $500K-$2M added). If IPO is uncertain or 12+ months out, the asset-depletion or Non-QM path now and refinance later is usually the better play. We model both scenarios with the specific timing.

Can I get a mortgage if my company just went through an acquisition (not IPO)?

Yes. An acquisition typically converts your private equity to either (a) cash proceeds at close, (b) acquirer’s public stock if acquired by a public company, or (c) new equity in a private acquirer. Cash proceeds support asset-depletion immediately. Acquirer public stock starts a new 12-month vest clock for RSU income but counts as liquid asset for pledge or depletion purposes.

My base salary is $150K but my private equity is worth $4M on the 409A. Can’t the lender count that?

Not for income, generally. The 409A valuation establishes the FMV for tax purposes — it doesn’t function as a market price for mortgage income qualification. Some specialty Non-QM lenders accept 409A-valued private equity at a 50–70% LTV haircut for collateral purposes (not income), but the lender pool is small and the rates premium. Asset-depletion against actual realized liquidity (tender, secondary, partial exit) is the better path for most files.

What if I want to early-exercise options to start the QSBS clock?

Early-exercise + timely 83(b) election within 30 days starts the LTCG holding clock and positions the stock for QSBS qualification (if the company meets the C-corp + asset-size requirements under IRC Section 1202). The cash cost of early exercise (strike price × shares) reduces your liquid reserves — sometimes meaningfully — which may affect your mortgage timing. We coordinate with your tax advisor on the trade-off.

My spouse also has equity at a different pre-IPO company. How does that affect us?

Both equity positions are acknowledged but neither directly qualifies as income under standard rules. We aggregate the joint W-2 base salaries, plus any 1099 or self-employment, plus accumulated liquid wealth from any tender/secondary/exit events for both spouses. Asset-depletion underwriting works against the combined liquid position.

Are there mortgage products designed specifically for pre-IPO equity holders?

No dedicated "pre-IPO" mortgage product exists. The relevant programs are asset-depletion Non-QM, bank-statement Non-QM, pledged-asset loans (against public stock only), specialty Non-QM with 409A acceptance, and base-only conventional. The specialty is in the broker who understands the structure and routes the file to the right lender.

Can my AMT credit from prior ISO exercises help my mortgage application?

Indirectly. AMT credits recovered against regular tax liability in future years reduce your federal tax obligation, freeing up cash flow. The credit itself isn’t qualifying income but the resulting higher take-home pay helps the DTI calculation. We coordinate with your tax advisor to document the AMT credit history.

My company is doing a secondary sale to PE investors. Can I participate and use proceeds for a mortgage?

Yes — if you qualify under the company’s participation rules (typically vested-only, sometimes capped percentage). The PE-led secondary deposits proceeds to your account similarly to a tender offer. We document the secondary closing and use the proceeds for asset-depletion or bank-statement qualifying. Coordinate timing — some companies require holding the proceeds in escrow for a defined period before final settlement.

What loan amount can I qualify for at $250K base salary plus $2M tender proceeds in a brokerage account?

Rough estimate: $250K base + asset-depletion on $2M ÷ 360 months = $5,556/month implied income, or $66,667/year. Total qualifying income roughly $317K. At 43% DTI and current jumbo rates, that supports total monthly housing of roughly $11,400. That maps to a $1.2M–$1.5M mortgage depending on rate, taxes, insurance, and other debts.

When should I start the mortgage conversation relative to a home purchase?

Ideally 60–90 days before you intend to make an offer. Pre-IPO files take longer than standard files because of the asset-depletion documentation, secondary-sale records, 409A valuation reports, and grant letter detail. Starting early prevents close-of-escrow surprises and lets us coordinate timing around any tender or secondary events that improve your qualifying picture.

I work at a foreign-private company that’s pre-IPO. Does any of this still apply?

Mostly yes — the U.S. tax frameworks (409A, QSBS, AMT, 83(b)) apply to U.S.-taxpayer employees regardless of where the company is headquartered, provided the equity grants are structured under U.S. tax rules. Foreign-headquartered companies sometimes structure grants under their home-country rules, in which case the U.S. tax treatment may differ. We coordinate with cross-border tax advisors on the specific structure.

10 · Companion guides & calculators

More on pre-IPO equity holder mortgages, equity comp, and homeownership.

Other executive paths

Loan-program details

Calculators & tools

11 · Sources & further reading

Sources & further reading.

IRS & equity-comp tax guidance

Cornell Law — statutory references

SEC & private placement

Mortgage program guidelines

BLS & Federal Reserve

12 · What "right door first" looks like

Pre-IPO equity holder mortgage, structured right.

Series D engineering lead at a late-stage SaaS company, four-year tenure, $215K base salary, large private RSU position not yet vested in any liquidity sense, but with three years of participation in annual tender offers totaling $1.6M deposited into the brokerage account. The big bank pulled just the base salary, saw "private company equity" on the file, declined to count any of it, and offered $640K maximum on base alone. We pulled the tender-offer closing statements, the brokerage statements showing the cumulative $1.6M, and structured the file as asset-depletion under Fannie Mae B3-3.1-09. $1.6M ÷ 360 months = $4,444/month of implied qualifying income added to the $215K base. Total qualifying income roughly $268K. Routed to a Non-QM lender comfortable with asset-depletion against multi-year secondary-liquidity history. Approved at $1.45M for an Aventura condo with marina views. Closed in 41 days. The path existed the whole time — the first bank just didn’t know how to read a pre-IPO file with realized secondary liquidity.

41-day close · Aventura, FL

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No application. No credit pull. A 20-minute conversation where we look at your base salary, your private equity grants, your tender-offer history, your 409A and 83(b) elections, your liquid asset position, and your goal — then we tell you which loan program fits and roughly what the numbers look like. If we’re not the right shop, we’ll tell you that too.

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Stairway Mortgage is a division of NEXA Mortgage LLC. Jim Blackburn NMLS #1072866.