What does the bank want to see as proof of my rental income?

[Asher Anthes]

I bought my house last year, live in it and rent out some of the rooms to friends. I have a positive cash flow. When applying for my next loan, what will the bank ask for as far as proof of my rental income so that I can use this on my debt to income ratio? Tax returns, lease agreements? Will they want to check my bank account to see the deposits of my rental checks (some of my tennants pay cash)?

Also what will they use as my total "income" for the debt to income ratio? My salary + (rental income - PITI - expenses). I'm assuming depreciation doesn't effect debt to income ratio at all, and therefore is a benefit both ways, right?

[Account Closed]

Depending on different policies of different bank they may ask you for Tax statement, Bank investment or invoice and contracts. As far as proof of income goes, your tax return is often your best bet.