If that is the case, are they using your actual rental rates to calculate the DSCR or the figures the appraiser determined?

Upfront expenses and monthly payments must be considered when calculating the return on your investment.EXAMPLEYou cash out $100,000 of your equity and use this as a down payment on a $400,000 investment property.

Be calculated about it.  

Also, I'd be curious to see the underwriting of how you calculated the $2800 figure.

If that is the case, to understand this you have to look at the previous year's taxes for valuation - especially what the taxable value was for the prior owner.I suspect this is very much a first time buyer's issue - where you weren't expecting the increase, but typically there is an increase to market value.  

Are you allowed to use let’s say 230K of the deduction in the year it was realized to bring taxable income from W-2 down to 70k and carry forward the 70k to the following year.

I'm not from your state - but in Florida your taxable basis is established by your purchase price at the time of the sale.  

If they can agree on current value then equity calculation is easy.  

Per this NY Times article, the average American knows around 600 people.https://www.nytimes.com/2013/02/19/science/the-average-american-knows-how-many-people.html#:~:text=The%20average%20American%20knows%20about,do%20you%20know%20named%20Kevin%3FPer the US Census Bureau, the average American moves 11.7 time in their life, which based upon an approximate lifespan of 84 years, works out to be about every 7 years.https://www.census.gov/topics/population/migration/guidance/calculating-migration-expectancy.html#:~:text=Using%202007%20ACS%20data%2C%20it,one%20move%20per%20single%20yearSo, if the average American knows 600 people and they each move about every 7 years, that means that the average American knows around 85 people that move in any given year.How many of those moves do you want to be involved in?

You can't calculate it like that because you are going to make about 20 percent of mistakes buying on your first 5-8 properties.