Compensation Letters
The full picture of what you earn — beyond base salary.
A letter breaking down base pay, bonuses, equity, and benefits — the answer when a reviewer says "total comp, not just salary".
Who it's for
- High-earning applicants where bonuses matter
- Mortgage applications
- Executive relocations
What's included
- Base salary
- Bonus structure
- Equity / RSU grants
- Benefits value
What it proves
- True total compensation
What this document actually is
For tech, finance, sales, and executive roles, base salary is usually less than half of total earnings. A compensation letter documents the other half: annual bonus targets, RSU vesting schedules, ESPP participation, benefits value, and any deferred comp. Underwriters at private banks, jumbo-loan lenders, and executive-mortgage desks won't approve a high loan-to-income without this — a $200k base looks very different when the applicant also earns $180k in RSUs annually.
When people reach for this document
You work in tech and want a jumbo mortgage
Base salary alone won't clear the jumbo threshold, but base + RSU vest schedule does. A comp letter makes the case.
You're a commission-heavy salesperson
A comp letter with your quota, historical attainment, and OTE turns lumpy earnings into a coherent narrative.
You're an executive negotiating a relocation package
Comp letters from the receiving employer are often shared with the origin employer's executive-mobility team to spec the relocation offer.
What the delivered document looks like
- Employer letterhead
- Base salary and pay frequency
- Target bonus (%, method, timing, historical payout rate)
- Equity: grant value, vesting schedule, next vest
- Other cash: sign-on, retention, deferred comp
- Benefits: 401k match, health, education stipend valued
- Signature block from HR or compensation office
What reviewers check
- Bonus target is realistic for role and industry
- Historical bonus payout rate is disclosed
- Vesting schedule is standard (4-year, 1-year cliff)
- Total comp aligns with market data for the role
Questions specific to compensation letters
Do lenders count RSUs as income?
Many jumbo and private-bank lenders count vested RSUs as income if the vest history is at least two years and the schedule continues.
Can I include unvested equity?
Show the schedule, but lenders discount unvested at various rates. Being explicit about vested vs. unvested is better than combining them.
Is this the same as an offer letter?
No. Offer letters state initial terms. Compensation letters are current-employee documents that reflect updated numbers, historical bonus attainment, and refresh grants.