How is income calculated on a bank statement loan?

Lenders average your eligible deposits over 12 or 24 months. On a business account they subtract an expense factor (commonly 50%, sometimes lower with a CPA letter) and apply your ownership percentage. On a personal account they typically credit close to 100% of qualifying deposits. The result is your qualifying monthly income — no tax returns required.

What is the expense factor on a bank statement loan?

The expense factor is the share of business deposits a lender assumes goes to running the business rather than to you as income. A 50% factor is the common default. A CPA, accountant, or tax-preparer letter stating your actual expense ratio can lower it — often to 10–25% — which increases the income the lender can credit.

Do bank statement loans use 12 or 24 months of statements?

Both are common. A 24-month review can smooth out seasonal or uneven income; a 12-month review may better reflect a recently growing business. Many lenders offer both, and some accept as few as 12 months for established self-employment.

What deposits count toward bank statement loan income?

Regular business or self-employment revenue counts. Transfers between your own accounts, loan proceeds, one-time windfalls, and other non-business deposits are usually excluded. Add up only the recurring, business-related deposits when you enter your total.

What credit score and down payment do bank statement loans require?

Most bank statement programs start around a 600–660 minimum credit score and 10–20% down for a purchase, though stronger profiles get better pricing. Requirements vary by lender — this calculator is an estimate, not a pre-approval.

Bank Statement Loan Income Calculator

Self-employed and tired of being judged by your tax returns? A bank-statement loan qualifies you on your deposits instead. Enter 12 or 24 months of deposits to see the qualifying monthly income a lender can actually credit you — and roughly how much home that buys.

Which bank statements will you use?

Business-statement programs credit your deposits minus an expense factor for the cost of running the business.

Your Deposits

Statement period

Total qualifying deposits over 12 months

Add up the eligible deposits across every statement in the period. Exclude transfers between your own accounts and one-off non-business deposits.

Expense factor

50%

Lenders assume a share of deposits goes to business expenses. 50% is the common default; a CPA or tax-preparer letter can lower it (often to 10–25%), crediting you more income.

Your ownership share

100%

If you co-own the business, lenders credit only your share of the income.

Estimate Your Buying Power (optional)

Add a few details to turn your qualifying income into an estimated loan amount and home price.

Estimated rate

Loan term

Other monthly debts

Car loans, credit cards, student loans.

Est. taxes + insurance + HOA

Monthly. Leave blank to estimate P&I only.

Max DTI

50%

Many non-QM programs allow up to 50%.

Down payment

10%

Your Qualifying Income

Qualifying monthly income

$0 / year that a lender can credit

How we got there

Avg. monthly deposits (12 mo)$0

Less expense factor (50%)($0)

Qualifying income$0

Enter your total deposits to see the income a bank-statement lender can credit you.

Estimate only. Programs vary by lender — your actual qualifying income depends on the lender's deposit and expense rules.

How bank statement income works

Traditional mortgages judge a self-employed borrower by their net income after every write-off on their tax return — which is exactly the number good accountants work to shrink. A bank statement loan looks at the cash actually flowing through your accounts instead. It's a non-QM loan, so it sits outside the standard tax-return playbook.

Qualifying income = (Avg. monthly deposits × [1 − expense factor]) × ownership %

On a personal account, lenders typically credit close to 100% of qualifying deposits. On a business account, they net out an expense factor for the cost of running the business.

The expense factor is the lever

The single biggest swing in your qualifying income is the expense factor. A 50% default assumes half your deposits go to expenses. If your business actually runs leaner, a short letter from your CPA or tax preparer stating your real expense ratio can drop it to as low as 10–25% — and meaningfully raise the income a lender will credit.

Service business, low overhead (consultant, contractor, creative): a CPA letter often supports a low expense factor — your income can climb sharply.
Product or inventory business: higher real expenses, so the default 50% may be close to right.
Personal-account deposits: no expense factor at all, but lenders scrutinize which deposits are genuinely income.

Tips to maximize your qualifying income

Run business revenue through one consistent account so deposits are easy to verify.
Get a CPA or tax-preparer letter on your true expense ratio before you apply.
Keep personal transfers out of the account you'll use to qualify.
Compare 12- vs 24-month programs — pick the window that reflects your income best.

Bank Statement Loan Income Calculator

Your Qualifying Income

How bank statement income works

The expense factor is the lever

Tips to maximize your qualifying income

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