Bank Statement Income Calculator
Qualify self-employed borrowers
Overview
The Bank Statement Income Calculator helps self-employed borrowers estimate their qualifying income for non-QM bank statement loan programs. Instead of using tax returns or W-2s, these loans use business bank deposits to calculate income.
Best Used For
Inputs
The calculator accepts the following input fields:
| Field | Type | Description |
|---|---|---|
| Calculation Period | select | 12 or 24 months of bank statements |
| Business Type | select | Service, Retail, Construction, Medical, or Custom |
| Expense Factor | slider | Percentage of deposits assumed to be expenses (10-90%) |
| Monthly Deposits | currency | Total deposits for each month (1-24) |
| Max DTI | slider | Maximum debt-to-income ratio (36-55%) |
| Estimated Rate | percentage | Expected interest rate for affordability estimate |
Outputs
The calculator returns the following results:
| Output | Description |
|---|---|
| Annual Qualifying Income | Estimated annual income for loan qualification |
| Monthly Qualifying Income | Monthly income after expense deduction |
| Total Deposits | Sum of all deposits in the calculation period |
| Average Monthly Deposits | Total deposits divided by month count |
| Est. Max Loan Amount | Maximum loan based on qualifying income and DTI |
How It Works
Qualifying Income Formula
Qualifying Income = Average Monthly Deposits × (1 - Expense Factor)
The expense factor represents the percentage of deposits assumed to be business expenses. A 50% expense factor means half of deposits are treated as qualifying income.
Expense Factors by Business Type
Different industries have different typical expense ratios:
| Business Type | Expense Factor | Income Factor |
|---|---|---|
| Service-Based | 50% | 50% |
| Retail/Product-Based | 60% | 40% |
| Real Estate/Construction | 65% | 35% |
| Medical/Professional | 50% | 50% |
Affordability Estimate
Monthly Debt Capacity = Monthly Qualifying Income × Max DTI
Max Loan = PV(Monthly Debt Capacity, Rate, Term)
The affordability estimate uses standard present value calculations to determine the maximum loan amount based on qualifying income and debt-to-income limits.
Example Scenario
A freelance consultant with average monthly deposits of $15,000 seeking a bank statement loan.
Inputs
Results
Explanation
With $15,000 average monthly deposits and a 50% expense factor, the qualifying income is $7,500/month ($90,000/year). At a 43% DTI, this supports a maximum payment of $3,225, which translates to approximately $438,000 in loan amount at 8.5% over 30 years.
Try the Bank Statement Income Calculator
Estimate qualifying income for self-employed borrowers using bank statement deposits.
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