What exactly is underwriting?

[Jonathan Bell]

Since I began looking into multi family property I've consistently seen/ heard of "underwriting" I've looked it up, but I feel as if I'm getting a different definition of what it actually is.  Is it actually just evaluating ones risk?

[Ronald Allen Barney]

It's a process that includes both the research of risk in a transaction, and finalizing the acceptance of that risk.  A mortgage lender will underwrite the loan.  Insurance will underwrite the policy.  And an investor like you will underwrite the business venture of buying the deal (or should at least).