IncomeChecker.com

Glossary

Property management, income & underwriting glossary

100 terms landlords, property managers, lenders, and applicants run into when income comes up, each with a short definition, a longer explanation, and a worked example.

Property management & leasingApplications, leases, deposits, and day-to-day rental operations.34 termsIncomeIncome types, pay documents, deposits, and proof of income.32 termsUnderwriting & creditRatios, credit, and how applicants and borrowers are evaluated.20 termsBank data & complianceOpen banking, data access, and the rules around consumer data.14 terms

#

1099 Income
1099 income is money paid to independent contractors, freelancers, and other non-employees, reported on an IRS Form 1099 without income tax withheld by the payer.
3x Rent Rule
The 3x rent rule is a common landlord guideline requiring an applicant’s gross monthly income to be at least three times the monthly rent.

A

Access Token
An access token is a credential an app receives after a user grants permission, letting it call an API on the user’s behalf, such as reading bank data, without ever handling the user’s password.
Account Aggregation
Account aggregation is collecting data from a person’s accounts at multiple financial institutions into one place, with their permission, so balances and transactions can be viewed or analyzed together.
Accredited Investor
An accredited investor is a person or entity that meets SEC income, net worth, or professional criteria and may invest in certain private offerings not registered with the SEC.
Adverse Action Notice
An adverse action notice is a disclosure required by the Fair Credit Reporting Act when a landlord, lender, or employer takes a negative action based in whole or in part on a consumer report.
Alternative Data
Alternative data is information used to evaluate applicants that is not in a traditional credit report, such as bank account cash flow, rent and utility payments, and employment or education records.
Annualized Income
Annualized income is an estimate of a full year’s income calculated from a shorter period, such as projecting 12 months of earnings from a few pay periods or months of deposits.
Applicant
An applicant is a person who formally asks to rent a property, borrow money, or join a program by submitting an application and the information the decision-maker requests.
Application Fee
An application fee is a charge a landlord or property manager collects when someone applies to rent, usually to cover the cost of screening and processing the application.
Average Daily Balance
Average daily balance is the average amount of money in an account across every day of a period, calculated by adding each day’s ending balance and dividing by the number of days.

B

Back-End Ratio
The back-end ratio is the percentage of gross monthly income used for all monthly debt payments, including housing, car loans, student loans, credit cards, and other recurring debts.
Bank Statement Analysis
Bank statement analysis is reviewing a person’s or business’s bank transactions to estimate income, spot recurring expenses, check balances, and flag risks such as overdrafts or unusual deposits.

C

Cash Flow
Cash flow is the movement of money into and out of an account, household, business, or property over a period. Positive cash flow means more money came in than went out.
Cash Reserves
Cash reserves are liquid funds a borrower or business still has available after a transaction closes, often measured in months of housing payments or operating expenses.
Cash-Flow Underwriting
Cash-flow underwriting is evaluating an applicant using income, spending, and balance patterns from their bank account data, often alongside or instead of a traditional credit report.
Co-Applicant
A co-applicant is a second person who applies alongside the main applicant and will share legal responsibility for the lease or loan if it is approved.
Co-Signer
A co-signer is a person who signs a lease or loan with the primary applicant and becomes legally responsible for the debt if the primary applicant does not pay.
Compensating Factors
Compensating factors are strengths in an application, such as large savings, long job history, or low payment shock, that can offset a weakness like a high debt-to-income ratio or thin credit.
Consumer Reporting Agency
A consumer reporting agency (CRA) is a company that regularly assembles or evaluates information about consumers and furnishes consumer reports to third parties for decisions about credit, insurance, employment, or housing.
Consumer-Permissioned Data
Consumer-permissioned data is financial information a consumer actively authorizes a third party to access, such as bank transactions shared through an open banking connection.
Credit Score
A credit score is a three-digit number, usually from 300 to 850, that estimates how likely a person is to repay debt based on the information in their credit report.
Creditworthiness
Creditworthiness is a lender’s judgment of how likely a person or business is to repay borrowed money on time, based on credit history, income, debts, and assets.

D

Debt-to-Income Ratio
Debt-to-income ratio (DTI) is the percentage of a person’s gross monthly income that goes toward monthly debt payments, including housing, car loans, student loans, and minimum credit card payments.
Direct Deposit
Direct deposit is an electronic payment sent straight into a recipient’s bank account, most commonly used for paychecks, government benefits, and tax refunds.
Disposable Income
Disposable income is the money a person has available to spend or save after income taxes are paid. It is sometimes confused with discretionary income, which is what remains after necessities too.
Document Tampering
Document tampering is altering a genuine document, such as a pay stub, bank statement, or ID, to change key details like income, balances, names, or dates.
Documented Income
Documented income is income supported by records such as pay stubs, W-2s, tax returns, bank statements, or benefit letters, as opposed to income an applicant only states.
Due Diligence
Due diligence is the investigation a buyer, investor, lender, or partner performs before a transaction to verify facts, uncover risks, and confirm what they are getting.

E

Eviction
An eviction is the legal process a landlord uses to remove a tenant from a rental property, usually for unpaid rent, a lease violation, or the end of a tenancy.

F

Fair Credit Reporting Act
The Fair Credit Reporting Act (FCRA) is a federal law that regulates how consumer reporting agencies collect and share consumer information and how others use consumer reports.
Fair Housing Act
The Fair Housing Act is a federal law that prohibits discrimination in renting, selling, and financing housing based on race, color, national origin, religion, sex, familial status, or disability.
Fake Pay Stub
A fake pay stub is a fabricated or altered earnings statement used to misrepresent income, often made with online pay stub generators or by editing a real stub.
Front-End Ratio
The front-end ratio is the percentage of gross monthly income that goes toward housing costs: mortgage principal and interest, property taxes, homeowners insurance, and HOA dues or mortgage insurance.

G

Gig Income
Gig income is money earned from short-term, task-based work, often through apps such as rideshare, delivery, or freelance marketplaces, rather than from a single employer.
Gramm-Leach-Bliley Act
The Gramm-Leach-Bliley Act (GLBA) is a 1999 federal law that requires financial institutions to explain how they share customers’ nonpublic personal information and to safeguard that information.
Gross Monthly Income
Gross monthly income is the total amount a person earns in a month before taxes, retirement contributions, insurance premiums, or other deductions are taken out.
Guarantor
A guarantor is a person who signs an agreement promising to pay a tenant’s or borrower’s obligations, such as rent, if the tenant or borrower does not pay.

H

Holding Deposit
A holding deposit is money an applicant pays to take a rental unit off the market while their application is processed or until the lease is signed.
Housing Choice Voucher
A Housing Choice Voucher, commonly called Section 8, is a federal rental assistance program in which a local housing agency pays part of an eligible household’s rent directly to a private landlord.

I

Income Continuity
Income continuity is the likelihood that a source of income will keep being received in the future, often judged by its history and any known end date.
Income Stability
Income stability describes how consistent a person’s income has been over time, based on how regularly it arrives and how much the amounts vary.

K

KYC
KYC (Know Your Customer) is the process financial institutions use to verify a customer’s identity and understand the nature of the relationship, to prevent fraud, money laundering, and terrorist financing.

L

Landlord Reference
A landlord reference is information a current or previous landlord provides about an applicant’s tenancy, such as dates, rent amount, payment history, and whether they would rent to them again.
Late Fee
A late fee is a charge added when rent or another payment is not received by the due date or the end of any grace period stated in the lease.
Lease Agreement
A lease agreement is a contract between a landlord and tenant that sets the rent, the term, and the rules each side must follow while the tenant occupies the property.
Lease Renewal
A lease renewal is an agreement between a landlord and a current tenant to extend the tenancy for another term, often with updated rent or conditions.
Liquid Assets
Liquid assets are cash and other holdings that can be quickly converted to cash without significant loss of value, such as checking, savings, money market accounts, and publicly traded securities.

M

Manual Underwriting
Manual underwriting is when a human underwriter evaluates a loan application directly, rather than relying on an automated underwriting system, usually for borrowers with limited or unusual credit.
Market Rent
Market rent is the amount a rental unit would likely lease for today on the open market, based on comparable units nearby with similar size, condition, and amenities.
Month-to-Month Tenancy
A month-to-month tenancy is a rental arrangement with no fixed end date that renews automatically each month until the landlord or tenant gives proper notice to end it.
Move-In Inspection
A move-in inspection is a documented walkthrough of a rental unit at the start of a tenancy that records its condition, usually with a signed checklist and photos.

N

Net Income
Net income is what remains after deductions. For a person, it is take-home pay after taxes and withholdings. For a business, it is profit after all expenses.
Non-Recurring Deposits
Non-recurring deposits are one-time or irregular deposits, such as tax refunds, transfers between accounts, loan proceeds, or gifts, that are usually excluded from ongoing income estimates.
Notice to Quit
A notice to quit is a written notice from a landlord telling a tenant to leave the property, or to fix a lease violation or pay overdue rent, by a certain date. It is usually the first formal step toward eviction.
NSF
NSF (non-sufficient funds) means a bank account did not have enough money to cover a payment, so the bank returned the check or electronic payment unpaid, often with a fee.

O

Occupancy Rate
Occupancy rate is the percentage of a property’s units that are currently leased or occupied, the inverse of the vacancy rate.
Open Banking
Open banking is the practice of letting consumers securely share their bank account data, such as balances and transactions, with third-party apps and services they choose, usually through APIs.
Overdraft
An overdraft happens when a bank lets a transaction go through even though the account does not have enough money, leaving a negative balance that the account holder must repay, often with a fee.
Owner Statement
An owner statement is a periodic report a property manager sends a property owner summarizing income collected, expenses paid, management fees, and the net amount distributed.

P

Pay Frequency
Pay frequency is how often an employee is paid, such as weekly, biweekly (every two weeks), semimonthly (twice a month), or monthly.
Pay Stub
A pay stub is a document that accompanies a paycheck and itemizes the employee’s gross pay, taxes, deductions, and net pay for the pay period and year to date.
Payroll Deposit
A payroll deposit is an employee’s net paycheck sent electronically by an employer or payroll provider into the employee’s bank account, usually through the ACH network.
Permissible Purpose
Permissible purpose is a legally valid reason under the Fair Credit Reporting Act for obtaining someone’s consumer report, such as evaluating their application for credit, insurance, employment, or housing.
Pet Rent
Pet rent is a recurring monthly charge added to a tenant’s rent for keeping a pet in the unit, separate from any one-time pet fee or pet deposit.
Proof of Funds
Proof of funds is documentation showing that a person or business has enough money available for a purchase or investment, usually a recent bank or brokerage statement or a bank letter.
Proof of Income
Proof of income is documentation showing how much money a person earns, such as pay stubs, tax returns, bank statements, an employer letter, or a benefits statement.
Property Manager
A property manager is a person or company hired by a property owner to run day-to-day operations, including leasing, rent collection, maintenance, and tenant relations.
Prorated Rent
Prorated rent is a partial rent payment charged for only the days a tenant occupies a unit in a given month, usually when a lease starts or ends mid-month.

R

Read-Only Bank Connection
A read-only bank connection lets an app view account data, such as balances and transactions, without being able to move money, make payments, or change anything in the account.
Recurring Deposits
Recurring deposits are payments that land in a bank account on a regular, repeating pattern, such as a paycheck every two weeks or a monthly benefit, and are commonly treated as signs of ongoing income.
Rent Concession
A rent concession is a discount or incentive a landlord offers to attract or keep tenants, such as a free month of rent, reduced rent for a period, or waived fees.
Rent Roll
A rent roll is a report that lists every unit in a property with its tenant, rent, lease dates, deposits, and balance due, giving a snapshot of the property’s rental income.
Rent-to-Income Ratio
Rent-to-income ratio compares monthly rent with gross monthly income, usually shown as a percentage (rent ÷ income) or as a multiple (income ÷ rent).
Rental Criteria
Rental criteria are the written standards a landlord uses to evaluate every applicant, such as minimum income, rental history, credit, and background requirements.
Rental History
Rental history is a record of where an applicant has rented in the past, including how long they stayed, whether they paid on time, and how they left each property.
Rental Ledger
A rental ledger is a running record of every charge and payment on a tenant’s account, including rent, fees, credits, and the resulting balance.
Residual Income
Residual income is the money left over each month after paying major obligations such as housing, debt payments, taxes, and basic living costs. The term also refers to passive income that keeps arriving after the initial work.
Risk-Based Pricing
Risk-based pricing is setting a loan’s interest rate, fees, or terms based on the borrower’s estimated risk, so applicants with weaker credit pay more than those with stronger credit.

S

Section 1033
Section 1033 of the Dodd-Frank Act gives consumers a right to access their own financial account data. The CFPB’s rule implementing it sets requirements for sharing that data with authorized third parties.
Security Deposit
A security deposit is money a tenant pays a landlord at the start of a lease, held to cover unpaid rent or damage beyond normal wear and tear when the tenant moves out.
Self-Employment Income
Self-employment income is money earned from running your own business or working as an independent contractor, measured as business revenue minus business expenses.
Soft Pull vs. Hard Pull
A soft pull is a credit check that does not affect your credit score, such as checking your own credit or a prequalification. A hard pull is a check made when you apply for credit and can lower your score slightly.
Source-of-Income Discrimination
Source-of-income discrimination is treating a rental applicant differently because of where their lawful income comes from, such as a housing voucher, Social Security, child support, or public assistance.
Stated Income
Stated income is the income an applicant reports on an application without supporting documents, relying on their own word rather than pay stubs, tax returns, or bank records.
Sublease
A sublease is an arrangement where a current tenant rents all or part of their unit to another person, the subtenant, while remaining responsible to the landlord under the original lease.

T

Tenant Screening
Tenant screening is the process landlords use to evaluate rental applicants, typically by reviewing identity, income, rental history, credit, and background information against written criteria.
Tenant Screening Report
A tenant screening report is a consumer report a landlord orders from a screening company, usually combining credit, eviction, and criminal record information about a rental applicant.
Tenant Turnover
Tenant turnover is when a tenant moves out and a new one moves in, along with the costs and vacant time that come with replacing them. It is often expressed as an annual turnover rate.
Thin Credit File
A thin credit file is a credit report with too few accounts or too little history to generate a reliable credit score. People with no credit record at all are called credit invisible.
Tradeline
A tradeline is an individual credit account listed on a credit report, such as a credit card, auto loan, mortgage, or student loan, along with its balance, limit, and payment history.
Transaction Categorization
Transaction categorization is labeling each bank or card transaction by type, such as payroll, rent, groceries, transfer, or loan payment, so the data can be summarized and analyzed.

U

Underwriting
Underwriting is the process a lender, insurer, or landlord uses to evaluate the risk of an applicant and decide whether to approve them, and on what terms.

V

Vacancy Rate
Vacancy rate is the percentage of rental units in a property or market that are empty and available at a given time, or the share of potential rent lost to vacancy.
Variable Income
Variable income is income that changes from pay period to pay period, such as commissions, tips, overtime, bonuses, seasonal work, or freelance earnings.
Verification of Deposit
Verification of deposit (VOD) is a form, commonly used in mortgage lending, in which a bank confirms an applicant’s account details, current balance, and average balance.
Verification of Employment
Verification of employment (VOE) is the process of confirming with an employer, or a database of payroll records, that a person works there, along with details like job title, start date, and sometimes pay.
Verification of Rent
Verification of rent (VOR) is confirmation from a current or previous landlord of an applicant’s tenancy dates, rent amount, and payment history.

W

W-2 Income
W-2 income is wages paid to an employee and reported on IRS Form W-2, with income and payroll taxes withheld by the employer before the employee is paid.

Y

Year-to-Date Earnings
Year-to-date (YTD) earnings are the total gross pay an employee has received from January 1 of the current year through the most recent pay date, as shown on a pay stub.

Browse by category

    Property Management, Income & Underwriting Glossary | Income Checker