How is bank statement income calculated?
Bank Statement Income Calculator
An educational estimate of how deposits become qualifying income. Expense factors and eligibility rules vary by lender; you enter the assumptions.
Estimated qualifying income
— / month
Enter total deposits to see the estimate.
- Average monthly deposits—
- After the expense factor—
- After ownership share—
- Estimated annual qualifying income—
An underwriter also looks at trend, consistency and the source of each deposit. Use this to understand the method, not to predict approval.
Assumptions and how this is calculated
- Qualifying income ≈ (eligible deposits ÷ months in the period) × (1 − expense factor) × your ownership share. This mirrors how bank statement programs are commonly described; each lender's method differs in the details.
- 'Eligible' deposits exclude transfers between your own accounts, loan proceeds, refunds, gifts and large unexplained items. Enter the total after those exclusions.
- Personal-account programs often count deposits in full (expense factor of zero) because business expenses were paid before the money reached you; business-account programs apply an expense factor. Lenders publish their own factors and accept CPA-prepared expense letters. You enter the factor to test.
- Ownership share prorates business-account income when you do not own the whole business.
- Declining deposits, seasonality and NSF activity change how an underwriter treats the same total; this estimator cannot see them.
Estimate only. This calculator is an educational estimate based only on the numbers you enter and the stated assumptions. It is not a loan offer, rate quote, pre-approval, or Loan Estimate, and it does not reflect the actual terms of any loan. Rates, fees, taxes, insurance and lender guidelines vary. Speak with a licensed mortgage professional before making decisions.
Behind the numbers
How deposits become qualifying income
A bank statement program starts from the deposits over a fixed period, usually twelve or twenty-four months. Transfers between your own accounts, loan proceeds, refunds, gifts and large one-off items are removed; what remains is 'eligible' deposits.
For personal accounts, many programs count eligible deposits in full because the business paid its expenses before the money reached you. For business accounts, an expense factor estimates what the business keeps after costs; lenders publish their own factors, and a CPA-prepared expense letter or profit-and-loss can often support a different one. If you own part of the business, the figure is prorated by your ownership share.
An underwriter also looks at the trend. Declining deposits, heavy seasonality or NSF activity can lower the qualifying figure or push a program to a longer window. This estimator shows the method; it cannot see the trend.
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The program this calculator belongs to.
Bank Statement Loans
Self-employed borrowers and business owners whose tax returns understate what they earn.
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