< Success Stories
From Stock Equity to Home Equity: Funding a San Francisco Home with Expiring ISOs
How Victoria turned expiring stock options and a concentrated position into a San Francisco home
May 26, 2026
Victoria is a 31-year-old software engineering manager in San Francisco. Over the prior two years, her former company’s stock had risen sharply, which resulted in her sitting on a position worth significantly more than when it first had been granted. She let them appreciate, but lost track of time and only discovered that her incentive stock options (ISOs) were expiring in six months as she was scoping out the possibility of purchasing a home in San Francisco. She needed to act fast.
She came to Monroe Wealth Management with a clear ask: what should she do with her equity before the options lapsed, and how can she use it to fund a down payment without triggering a big tax bill.
Victoria's ISO holdings carried a different tax treatment depending on whether she exercised and held versus exercised and sold. Additionally, her concentrated position in her company added market risk she wasn’t fully accounting for. Add all of that to her goal of purchasing a home in the next year, we had to incorporate a liquidity requirement when evaluating any equity liquidation decision.
Most people in her position make one of two mistakes: they either wait too long and let options expire, or they sell everything at once without accounting for the tax consequences. Victoria avoided both by coming to Monroe Wealth Management.
We modeled out multiple scenarios across her portfolio to understand the tax implications of different exercise-and-sell ratios that would fall under both ordinary income and capital gains tax treatment. We showed her exactly what each path cost in taxes and what it preserved in upside.
She chose to exercise and sell the majority of her ISOs before the expiration date, retaining only a small portion for potential continued appreciation. We reinvested the after-tax proceeds in a diversified portfolio and structured a box spread strategy, which is a form of borrowing against a portfolio position, that allowed her to partially finance her home purchase alongside a traditional mortgage. The result was a financing structure that let her close on the home without fully liquidating her investment position.
Victoria now owns her dream home in San Francisco and her investment portfolio remains intact and diversified. In fact, she's actually grown her net worth even after purchasing her home as it is tied both to the appreciation of her Bay Area real estate and the stock market.
Don’t navigate complex equity decisions alone. Let’s build a plan to protect your gains and reach your goals.
