Simply Approved Mortgages
Glossary

Investor loan glossary

Plain-English definitions for the terms that come up on every deal.
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Investor Loan Glossary: what do real estate investors need to know?

Plain-English definitions of the DSCR, underwriting, and investor-strategy terms that come up in real-estate financing. Final eligibility, pricing, and terms are subject to a complete application, credit and property review, and full underwriting.

Key takeaways
  • Plain-English definitions of the DSCR, underwriting, and investor-strategy terms that come up in real-estate financing.
  • Every figure shown is an estimate for business-purpose investment property financing only — not an offer or commitment to lend.
  • Simply Approved Mortgages is a licensed mortgage broker (NMLS #2620881), licensed for residential lending in Florida and Colorado and arranging business-purpose investor loans across our approved 37-jurisdiction footprint.

DSCR

DSCR (Debt Service Coverage Ratio)

Rent ÷ PITIA. Whether the property covers its own debt.

PITIA

Principal + Interest + Taxes + Insurance + HOA.

NOI (Net Operating Income)

Gross income minus operating expenses (not including debt).

No-Ratio DSCR

DSCR loan with no minimum DSCR requirement.

Underwriting

LTV (Loan-to-Value)

Loan amount ÷ appraised property value.

ARV (After-Repair Value)

Appraised value assuming the rehab is complete.

Seasoning

Time you've held title before a refi is allowed.

Reserves

Months of PITIA held in a US bank at closing.

Condo Warrantability

Whether a condo project meets agency lending standards.

Occupancy

How the property is used: owner-occ, second home, investment.

CLTV (Combined Loan-to-Value)

All liens combined ÷ property value.

Debt Yield

NOI ÷ Loan amount. Lender's cash-flow test independent of rate.

Structure

LTC (Loan-to-Cost)

Loan amount ÷ total project cost (purchase + rehab).

Prepayment Penalty (PPP)

Fee for paying off the loan early.

Interest-Only (IO) Period

Payment period where no principal is paid.

Vesting

How title is held (LLC, individual, trust).

Personal Guarantee

Individual liability behind an LLC loan.

Cash-Out Refinance

Refi that returns equity as cash at closing.

Cross-Collateralization

One loan secured by multiple properties.

Investor Strategy

BRRRR

Buy, Rehab, Rent, Refinance, Repeat.

Cap Rate

NOI ÷ Property value. Yield metric independent of financing.

Cash-on-Cash Return

Annual cash flow ÷ total cash invested.

HAP Contract

HUD Housing Assistance Payment contract for Section 8 tenants.

Fair Market Rent (FMR)

HUD's estimate of gross rent for a metro area, by unit size.

1031 Exchange

Tax-deferred swap of one investment property for another.

Simply Approved Mortgages Expert Insight
Last reviewed

How We Evaluate This Scenario

A DSCR file is judged on the property, not your tax returns: qualifying rent divided by PITIA — principal, interest, taxes, insurance, plus HOA and flood where they apply. Most programs use the lesser of the in-place lease rent and the appraiser's market rent, so a lease signed below market usually caps the ratio no matter how strong the comps look.

Three inputs move the outcome more than anything else: rent support on the appraiser's rent schedule (Form 1007 or 1025), the LTV tier, and the credit tier. Dropping leverage by five points or moving up a FICO band frequently changes pricing more than shopping a different lender does.

Before you write an offer, price taxes and insurance at post-sale levels rather than the seller's current bill. In reassess-on-transfer states and in coastal insurance markets, that single adjustment is the most common reason a deal that penciled at contract fails the ratio at underwriting.

Reviewed by Simply Approved Mortgages · NMLS #2620881. Business-purpose investor lending only.

Investor pre-approval

Get your personalized investor loan quote

Pick the loan type that fits your deal and complete a short, tailored pre-qualification. A licensed loan officer follows up with an initial scenario review once we have your credit authorization and supporting documents — usually the same business day. Formal pricing and terms follow underwriting.

Pick a loan type

You can change this any time.

Tell us about your scenario

The form below is tailored to DSCR rental loan — only the questions your program needs.

1
Your info
2
Your deal
Your deal — the basics

Purchase or refinance a rental. The property's rent qualifies the loan.

What's your goal?
Purchase price ($)$450,000
$
Down payment (%)20%
%
Monthly rent ($)$2,800
$
HUD Fair Market Rent for your ZIP — ballpark only. Get a precise market rent after you submit.
Estimated credit rating

A soft self-estimate — no credit pull happens here.

This is a pre-qualification request — not a loan application under TILA/RESPA and not a loan approval, rate lock, offer, or commitment to lend. It does not trigger a Loan Estimate. If your loan requires one, the Loan Estimate is issued inside our loan origination system after you submit a complete application and your loan officer has reviewed your scenario.

Encrypted and never sold. Takes about 60 seconds.

Your answers save as you go. A licensed loan officer typically follows up the same business day · Simply Approved Mortgages LLC, NMLS #2620881.

Credit & pre-approval

Why we pull credit for your investor loan pre-approval

Every DSCR / business-purpose loan file needs a tri-merge credit report so we can verify identity, price your rate tier accurately, and confirm reserves and payment history for the underwriter. Cleaner credit typically unlocks a better rate and higher leverage.

Pay for your credit report — SmartPay

Simply Approved Mortgages uses MeridianLink SmartPay to securely collect the credit report fee for your investor pre-approval. Payment goes directly to the credit vendor — not to us — and unlocks your tri-merge report (Equifax, Experian, TransUnion) so your loan officer can price your file.

  • Secure, PCI-compliant checkout hosted by MeridianLink
  • Required for a formal investor pre-approval decision
  • Soft-touch process — your loan officer will guide you through it
Pay for credit report securely

You'll be redirected to cic.cra.xedalink.net (SmartPay).

Check your credit first — $1 trial at MyITINCredit

Before you apply, it's smart to know exactly where your credit stands. MyITINCredit offers a $1 trial for 15 days that includes all three credit reports and scores (Equifax, Experian, TransUnion), plus ongoing credit monitoring so you can catch errors, dispute inaccuracies, and watch for identity theft.

  • See all 3 bureau reports & scores before your lender does
  • Ongoing monitoring alerts you to new accounts or score changes
  • Fix errors early — cleaner credit can widen your investor loan options
Start $1 / 15-day trial

You'll be redirected to myitincredit.com. Third-party service — terms apply.

Credit report fees are paid directly to the credit vendor. Simply Approved Mortgages does not profit from the credit pull. MyITINCredit is an independent third-party service; pricing, terms, and features are set by that provider.

Investor newsletter

Rates, market shifts, and program changes — in your inbox.

Periodic investor updates: rate movement, guideline and program changes, and market data refreshes. No spam, unsubscribe anytime.

  • DSCR rate snapshots
  • Program & guideline updates
  • Illustrative investor scenarios
  • Market data notes
Get the investor update
Investor newsletter

Periodic DSCR rate updates, market data refreshes, and program changes. No spam, and we never sell your address.

I agree to receive periodic investor market and program update emails from Simply Approved Mortgages LLC. I can unsubscribe at any time. Submitting this form records your consent and the page you signed up from. It is not a loan inquiry and does not start an application.

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