Watch Grant Cardone explain what it means to underwrite a real estate deal. Find out why it’s important, who should do it and the calculations involved so you end up with the best deal that will make you the most money. An underwriter determines how much risk the lender is willing to accept. In most real estate loans, the property itself is used as collateral against the borrowed funds. Grant uses several underwriters on a deal so he can determine the WCS (worst case scenario) to make sure the deal will be profitable. He looks at the GSI (gross schedule income), studies the EGI (effective gross income), deducts operating expenses to reveal the NOI (net operating income) and uses this data to calculate a capitalization rate so he can determine if the deal is worth pursuing. Underwriting is another tool to learn when it comes to investing in real estate. Think big. Go big. Play big and know what you’re doing.