Mon, 1 May 2023
Learn how to harvest equity without giving up your low, fixed-rate mortgage.
Today, I discuss: conventional loans for single-family rentals, DTI, refinancing, accessing equity, student loan debt, and down payment requirements for income properties with Ridge Lending Group President, Caeli Ridge.
Learn what’s better for a second mortgage—the pros and cons of a HELOC vs. Home Equity Loan.
You also get a mortgage market overview.
We discuss changes in cash-out refinance seasoning requirements.
Caeli also describes where she believes mortgage rates are headed later this year.
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Speaker 0 (00:00:00) - Welcome to GRE! I'm your host Keith Weinhold. You can get a conventional loan for a single family rental with less than a 20% down payment. Learn why you might want to refinance today. Even though mortgage rates aren't as low as they were a couple years ago, how do you qualify for loans if you've already got student loan debt? All things mortgages and financing today on Get Rich Education,
Speaker 2 (00:00:29) - You are listening to the show that has created more financial freedom than nearly any show in the world. This is Get Rich Education.
Speaker 0 (00:00:52) - Welcome to GRE from K Patis North Carolina to Hattiesburg, Mississippi and across 188 nations worldwide. I'm Keith Weinhold. This is Get Rich Education, the voice of real estate investing since 2014. Before we get into a great education on all things mortgages today, there is still a little bit of time left for you to join us on tomorrow night's G R E Live event. You can join us from the comfort of your own home. This is for new build single family rentals, opt to four plexes in Jacksonville, Ocala, and elsewhere in Florida. Purchase prices are still below 300 K on the single families. Yes, still in the two hundreds in some cases. I don't know how long that can last. Yeah, these are the property types that are quickly vanishing. Our investment coach Naresh Stars in that event tomorrow, he finds you the good deals with the national providers that are actually giving incentives despite the fact that the product that you're buying is in really short supplies.
Speaker 0 (00:01:59) - You're gonna get a good, solid, fundamental education on what makes a durable income property market and a arrest in the Florida provider are going to share with us just for webinar attendees. Those even better than two and two incentives. Yes, for you, the incentives on the webinar are even better than that 2% of your purchase price paid do you in closing costs cash and 2% of free property management. It is going to be even better than that. That's gonna be rolled out tomorrow night, May 2nd at 8:30 PM Eastern, 5:30 PM Pacific. It is free to attend. You can ask questions live, get your questions answered and get access to the actual properties should you so choose. That is the final reminder. So if that's of any interest to you, be sure to sign up email@example.com. I'm coming to you from the Mojave Desert today here in metro Las Vegas.
Speaker 0 (00:03:04) - It's Henderson Nevada. To be technical next week I'll bring you the show from Phoenix, Arizona. And you know what? It's kind of funny. Sometimes you hear people refer to this general area of the nation this southwest and they say they are going to the desert if they were doing what I'm doing. Well this unrepentant geography nerd will clarify that it is the deserts plural. Yes, Las Vegas is in the Mojave Desert in Phoenix is in the Sonora Desert. There are differences in vegetation type and others that distinguish the two. And the most obvious difference perhaps is the presence of the big iconic Saguaro cactus down in the Sonora that you don't find up here in the more northerly Mojave and perhaps the Joshua tree is the more distinct plant type here in the Mojave. Yes, we're talking about two gigantic pieces of real estate here. Much of it is baron. Two disparate deserts with their own distinctive flora and fauna. As you're about to learn about financing real estate today, let's remember that there is a cash out refinance and then generally if you're performing a refinance without pulling cash out, that is known as a rate and term refinance. Let's get into it.
Speaker 0 (00:04:30) - Well hey, well how do you qualify for more mortgage loans at the lowest interest rate available, Americans have near record equity levels in their homes. What's the best way to access that equity yet keep your low mortgage rate in place? And what about your student loan debt and how that factors into you getting a mortgage or getting a refinance? We're answering all that today with a GRE regular guest and though it's her first appearance back on the show this year, it's the return of the company president that's created more financial freedom through real estate than any other lender in the entire nation, Ridge Lending Group. It's time for a big welcome back to Caeli Ridge.
Speaker 3 (00:05:08) - Keith Wein. Hold. Thank you. You flatter me sir. I appreciate it. Love being here with you and for your listeners.
Speaker 0 (00:05:14) - Well yes, the president is back and everyone loves this type of president because it's not about being a Democrat or Republican. So hail to the chief, great to have you here. And Jaylee mortgage rates, they have settled down a good bit from their recent highs now they peaked back in the fall of last year. So with that and some of the other things in mind, why don't you talk to us about the big picture first, sort of your mortgage market overview.
Speaker 3 (00:05:40) - Interest rates is always top of mind for everybody. I think they're doing pretty well. I do believe I've been sharing with our listeners and and my clients on a day-to-day. I do believe that rates will continue to kind of increase here and there. There's gonna be some ups and downs. Of course the Fed has been very clear with us. Jerome Powell is gonna continue to raise the Fed fund rate just for anybody that doesn't know the two between a mortgage rate and a Fed fund rate while connected, not the same thing. So when they raise that does not automatically mean that we see the increase on the the 30 year mortgage bonds. I think that that's gonna continue to happen, but I think the pace in which it happens or continues to happen is gonna be a lot less aggressive. So I think that's gonna bode well overall.
Speaker 3 (00:06:21) - For interest rates. I know everybody is very, very interested in in are they going up, are they going down, when are they going up, when are they going down? I think that we'll continue to see a little bit of upward movement. I think it's gonna be sometime next year that we start to see interest rates come back down in any meaningful way. And remember gang rates go up much, much faster than they come back down unfortunately. So I think we've got a little bit of way to go. But I'm always the one saying, Keith, you and I have talked about this, um, many, many times you must be doing the math and that the rate as a function of the return of the investment isn't the most important thing. So I'll leave it there for rates. Otherwise, I think that the industry is doing really, really well.
Speaker 3 (00:06:58) - One big announcement that we had this year was that Fannie and Freddie both have extended the seasoning period of time to where a cash out refinance when leverage was used to acquire is applicable. So now you have to wait 12 months to pull, to pull cash out of a property using the A R V that after repair value if you use leverage to acquire the property. Quick distinction because this has been confused. If you paid cash for the property, your source and season funds, that still falls under what's called the delayed cash out refi and no seasoning is required. It's only when leverage was used to acquire the property and then they're trying to use an after repair value to pull cash out in hand. Is that 12 month seasoning rate and term is different. So that doesn't apply either.
Speaker 0 (00:07:45) - Okay. So if you make a purchase and then say it less than 12 months down the road, you want to do a refi but not pull cash out, is that still all right?
Speaker 3 (00:07:55) - That's absolutely fine. No seasoning is required and we can use the arv. It's only when you want cash in your hand that that 12 months is is applicable.
Speaker 0 (00:08:04) - Got it. Okay. That's really helpful to know. Just big picture before we winnow down, are there any other big substantial mortgage stories out there that some should know about? Um, it was only a couple weeks ago, there was a lot of misinformation going around on TikTok and elsewhere about 40 year loans from F H A without people understanding that's just for loan modifications and really other stories like that. Any other big picture things where you can help us see what's happening?
Speaker 3 (00:08:30) - It seems to be par for for the course? I have not. There's nothing that's come across my desk that I would say was newsworthy or noteworthy to share. I think we've got more to unpack here than any of that.
Speaker 0 (00:08:40) - Yeah and things sure are picking up here around G R e. People wanna buy more properties this year. It really slowed down toward the end of last year, right about when the mortgage rates were at their peak. So when we talk about getting loans, we think about leverage. Leverage is created with debt. Has anything changed with the down payment requirements for an income property? And we're largely here in today's discussion talking about one to four unit income properties. Properties that you don't live in yourself,
Speaker 3 (00:09:08) - Correct down payments have have remained the same. There isn't been anything that has changed there. Just to reiterate, for those that may not be aware on a single family residence, conventionally 85% loan to value is applicable. You can leverage all the way up to 85, you're putting 15% down. Keep in mind everybody that that will have pmi, private mortgage insurance attached to it, I would have you look at them side by side. The PMI factors actually pretty low and depending on the loan size it may only be 20, 30 bucks a month. So if you're able to leverage extra, it may make sense. You're gonna have to look at the numbers so that single family and then two to four unit on a purchase transaction different on a refinance transaction but purchase is 25% down or 75% leverage is required for those duplex, triplex, fourplexes.
Speaker 0 (00:09:54) - Okay, so as little as 15% down on a rental single family home. So you're getting up to six to one, seven to one leverage in that case. Sheila, do you find very many people doing that or would they rather pay the 20% down for a rental single family home and not have the pmi?
Speaker 3 (00:10:10) - I find that right now I think that it's less common than maybe it was because interest rates are up from where they were, uh, a year, year and a half ago. So more often than not we see the 20% down. But I still think it's worth looking at. I mean you're never gonna know unless you run the numbers right side by side.
Speaker 0 (00:10:25) - Okay, so we're thinking about how much cash we have to have put aside for a down payment in closing costs. And one thing that we need to do in order to qualify for that loan in the first place of course is some people get hung up on the dti, their debt to income ratio is too high to qualify for property and chaley. Over the past few months I've had a few listeners write in with questions and I thought, well I'll say that question until we have chale on again. And one of them really has to do with student loan debt. Student loan debt often contributes to one having too high of a debt to income ratio so that they didn't have to repay their loan. I know that Biden said that you wouldn't have to pay back student loan debt for a while, but can you talk to us specifically about student loan debt with D T I?
Speaker 3 (00:11:06) - There's gonna be a few pieces to share with everybody depending on whether we're talking about Fannie Mae or Freddie Mac and we won't know who we're gonna end up selling to after the loan funds. And they have slightly different guidelines between the two of them. Similar. But there are some differences as it relates to student loan debt regardless of whether you're in deferment or you've been told that you don't have to repay. If it shows up on an individual's credit report, the calculation will be as follows. They're going to take the outstanding balance times 1%, that's Fannie Mae's rule or the outstanding balance times half a percent. That's Freddie Mac rule and that will be the payment that we include in the debt to income ratio. Uh, I'll mention that the all-in one, which is a very popular loan right now. First Lean HeLOCK, maybe we'll talk about that here today. They will defer to Fannie rules so it'll be 1% of the outstanding debt pulling on the credit report even if it shows a zero payment listed. Now there is one caveat, if the individual has a letter, this happened maybe in the last six months and I'm trying to think about, there was a title, it's pretty rare. But if they're able to gain access to documentation that specifies that they are not going to have to repay that debt and we can take that documentation, then we can zero out that payment in the D T I.
Speaker 0 (00:12:22) - Alright, there's some strategies for how you can approach D T I with respect to any student loan debt that you have and what is the maximum D T I that a borrower can have?
Speaker 3 (00:12:34) - Conventionally and non qm, you're gonna get to 50% debt to income ratio for the all-in-one since we just touched on it, 43% is the absolute max.
Speaker 0 (00:12:43) - Okay. And on prior shows, Chile and I have discussed specifically with examples just how that D T I is calculated. If you're wondering, you can hear that in some past episodes Chile one one goes ahead and they continue to add income properties to their portfolio. Often I recommend that one does that with high leverage but not over leverage. How does one keep their D T I ratio down over time as they continue to add properties so that they can qualify for more properties in the future? Is there a good strategy for that?
Speaker 3 (00:13:14) - There is, and it's such a good question because as investors, right, our qualification primers are not static. They're going to change over time as we buy and sell and refinance. So it's very, very important, especially with the debt to income ratio that we're keeping an eye on it. And there's a few ways in which you can kind of strategize or optimize that D T I. The first is going to be the Schedule E, okay? The Schedule E is where all the rental properties are going to live once you've filed the annual tax return. The easiest way for the time that we have here today, Keith, is gonna be to tell the listeners, send us your draft returns. So on an ongoing basis we tell our active clients do not file federal tax returns until you send us the draft. We're going to run that draft through the pre-formulated calculation that comes straight from Fannie, Freddie and then we're gonna provide you with some feedback, one of which may be Mr.
Speaker 3 (00:14:03) - Jones, you forgot to include your insurance as a deduction and that's actually an add back that's gonna be to your disadvantage. Make sure that you put that in there. You didn't claim the full number of days of income for the property, you forgot to put depreciation on there. That's also an add back. There's a whole slew of things that we can look at and look for and give the individual that feedback so that they are filing at that optimal way while maintaining what the maximized tax credits are, right? There's a nice balance there. The more aggressive you are with the tax deductions, the more it can impact the D T I. So we wanna have eyes on that and work closely with the client and or their CPA is a very common part of what we do. So schedule E a little more complicated, that would be one of the the ways in which we wanna maximize debt to income ratio.
Speaker 3 (00:14:45) - Obviously not obtaining new debt, new consumer debt is is not gonna be to our advantage, right? We don't want more liability than we have income. Another thing is, is that when we talk about credit and a lot of clients that we talk to, they pay their credit cards off monthly, right? Maybe they charge up five grand, eight grand, 10 grand, they get a miles or whatever it is. It's very important to communicate with us to find out when in the month we wanna strategically pull the credit. Because what will happen is is that the day in which we take that snapshot, if there's a minimum payment due, a balance with a minimum payment, that minimum payment will be used in the individual's debt to income ratio regardless of whether they're gonna pay it off at the end of the month. That doesn't matter to us.
Speaker 3 (00:15:26) - There's a payment here, we gotta hit you for it. So strategizing on the day in which we wanna run credit might be another helpful way for D T I. And then finally, and there's probably a few other things, but I think high use would be, I don't like the shorter term amortizations. I think this is something else you and I have talked about many times, Keith, where people wanna pay off quicker, which is great if that's really what they wanna do, that's perfectly fine. I'm not sure that that would be my strategy, but whatever. Don't get yourself into a 15 year fixed mortgage because it's only gonna jack that payment. It's gonna really increase that payment. It's ultimately going to, for long-term optimization, hurt your D T I. You can do the same thing with a 30 year mortgage and not pay extra interest by accelerating the debt if that's what you chose. So those would be the the few things I'd comment on
Speaker 0 (00:16:10) - 100%. And for you the listener and viewer right now with what you just heard from chaley, you can begin to understand the value of working with a lender that works specific with income property investors rather than those lenders that are more geared toward primary residents, borrowers. Nothing wrong with them but they're in their lane during their thing. And you can understand why Chaley over there at Ridge is really a specialist to help you qualifying for as many income property loans as you possibly can and optimizing those loans as well. Chaley, when we talk about interest rates, oftentimes it's of interest to people to look at what are refinance interest rates like versus new purchase interest rates.
Speaker 3 (00:16:54) - I would say on average there's a variety of of variables that dictate what the rate is gonna be. Okay? I talk about this a lot. They're called LPAs loan level price adjustments. And a loan level price adjustment is a positive or negative number that attaches to the characteristic of the loan transaction. So purchase or refi, hash out refi rate and term refi credit score has its own L L P A loan to value, loan size occupancy. All of these come with a positive or negative number attached to them as it relates to purchase versus refinance. Generally speaking, let's take a rate and term refi where you're not getting cash out, you're just maybe taking an arm and making it affix. You're taking a higher rate and making it lower, whatever, maybe about a half a point difference. So if a purchase was at six and a half, the re rate and term refinance might be at 6 75 or 7%, cash out's gonna be a little bit different. I would add a quarter point to that and then if, if it's a two to four unit, add another quarter point on top of that. So those variables do make a difference.
Speaker 0 (00:17:53) - And maybe the listener might think, well why are you talking about refinancing at a time like this? If I wanted to refinance, I would've been more likely to do that about two years ago when mortgage rates read historic lows. But today Americans are sitting on near record equity, oftentimes it might be tied up in a low mortgage rate loan with that equity chaley. I talked to some people out there just lay people, people that aren't even investors and they have a big equity position with a really low mortgage interest rate loan and they seem to think that to refinance it, they would need to go ahead and refinance their entire mortgage and lose that maybe three or 4% loan, but they don't necessarily have to if they can do a second mortgage. So I guess really what I'm getting at and the question chaley is what is the best way to do a rate and term refi versus a cash out refi? And I know there are a lot of scenarios there.
Speaker 3 (00:18:44) - Yeah, lots of scenarios. So to your point, it is not necessary to give up a very low fixed rate mortgage if you want to harvest some of that equity. The ways in which, and I'm gonna have a plug after this for the all in one, but I'll get to that cuz I'm just such a big fan. But the ways in which you can do that both for your primary residents, a second home and an investment will be through a second lien mortgage, whether it be a heloc, home equity line of credit or a he loan, the HE loan is applicable for the rental properties. I do not believe, I hope somebody can give me alternative information, but I do not believe you're able to find second lean HELOCs for rentals today. I feel like those have really dried up if they're out there, the ones that I know of that used to do them are not doing them anymore.
Speaker 3 (00:19:27) - If they're out there and anyone's listening to this, somebody please let me know. Keylock for rental probably not an option. He loan for rental absolutely is an option. And this is guys a fixed rate mortgage in second lean position, just like your 30 year fixed first, this will be a 30 year fixed second interest rates are gonna be higher. And since we were talking about interest rates, I'm gonna say that they're probably anywhere from 10 to 13%, but they're smaller amounts. C L T V combined loan to value for a he loan on a rental would be 85% is what we have access to. So as quick math guys, if you have a value of a home of a hundred thousand and you owe on your first mortgage 50,000, the CLTV would be 85% of a hundred. So 85,000 minus the 50001st, which stays in place, you'd have access to about 35,000 in that example. And that would be access to rental properties that you just do not want to mess with that first lien mortgage different for owner-occupied. And I'll take your queue on when you want me to get into that.
Speaker 0 (00:20:26) - Yeah. Okay. So we are just talking about income property second mortgages there. Tell us about primary residences.
Speaker 3 (00:20:32) - So primary and secondary should be in the same bucket. You can leverage just 90% C L T B, same math as before but up to 90% And these are gonna be, you have HeLOCK and he loan. I'm gonna assume most people are gonna go for the HeLOCK, right? The open-ended revolving is definitely more attractive than a closed-ended fixed I believe in a second lien. And you know Prime is at eight I believe right now. Gosh, I should have checked before we go on, but I think Prime is sitting, it's an index. An indices like the Fed fund rate, that's an index two prime is at about eight. And then depending on the characteristics, those l LPAs that I mentioned, loan level price adjustments are gonna come up with a margin. Maybe it's 2% over prime or one or whatever it is depending on those things. So I would anticipate a HELOC and second lie position on a primary residence will be anywhere from eight to maybe 10%. More often than not is what you should expect. Interest only open-ended.
Speaker 0 (00:21:24) - And on the second mortgages, whether that takes the form of a HELOC or a HE loan, how long is the initial fixed rate period? Typically
Speaker 3 (00:21:32) - There are hybrids where you can fix in for a year or three years, et cetera. Those are available. I'm not sure that you wanna do that in a high rate environment. You probably wanna avoid any fixed rate right now if you had the option to get into it a couple of years ago, you're looking really good right now because you fixed in at at some ridiculously low rate for a period of two, three, maybe five years. I would tell people listening, fixing in on a HELOC right now is not gonna be your advantage when we believe that rates are gonna start coming down over the next year, et cetera. But for the HE loan, it's fixed for 30 years. Just like a 30 year fixed first lie mortgage, it's fixed, you have it four 30 years, it's amortized, it's closed ended. You're making your regular payments until you pay it off after the 30 year period of time.
Speaker 0 (00:22:13) - We're talking about how you can more efficiently borrow in this environment where people and investors have high equity positions and we have hopefully come off the mortgage rate highs from late last year. You're listening to Get Risk Education. Our guest is Ridge Lending Group President Chaley Ridge Morton, we come back. I'm your host Keith White Hole with JWB Real Estate Capital. Jacksonville Real Estate has outperformed the stock market by 44% over the last 20 years. It's proven to be a more stable asset, especially during recessions. Their vertically integrated strategy has led to 79% more home price appreciation compared to the average Jacksonville investor. Since 2013, JWB is ready to help your money make money, and to make it easy for everyday investors, get started at jw b real estate.com/g rre. That's JWB real estate.com/g R E GRE listeners can't stop talking about their service from Ridge Lending Group and MLS 40 2056. They've provided our tribe with more loans than anyone. They're truly a top lender for beginners and veterans. It's where I go to get my own loans for single family rental property up to four plexes. So start your pre-qualification and you can chat with President Chaley Ridge personally. They'll even deliver your custom plan for growing your real estate portfolio. firstname.lastname@example.org.
Speaker 4 (00:23:45) - This is Rich Dad sales advisor, Blair Singer, listen to Get Rich Education with Keith Wine Hold and above all don't quit your daydream.
Speaker 1 (00:24:03) - Welcome
Speaker 0 (00:24:04) - Back to Get Rich Education. We're learning about how to be a savvy borrower with President of Ridge Lending Group, Chaley Ridge and Chaley. One product you have there that's really flexible and has helped out so many people and helped save borrowers tens of thousands of dollars in interest or more is what's called your all in one loan. Tell us about it.
Speaker 3 (00:24:25) - This is a first Lean HeLOCK everyone. I'm such a big fan, it's not for everybody, but for the right individual, I don't know that there is a loan product to rival it. It's got all the flexibility in the world and as Keith said, the mechanics of this and the concept of this arbitrage, it's called Velocity Banking, infinity Banking. If anybody's familiar with those terms, that's what this does. It allows you all the open flexibility to sort of become your own bank where you have this line of credit. It is a first lien line of credit. So let's take a a step back and talk about those low interest rates that everybody has secured over the last couple of years. We were very lucky to have to two and a half, 3% interest rates. And I'm constantly having this conversation and I'm really trying hard to dispel the psychology of you can never do better than that when it's just not the truth.
Speaker 3 (00:25:14) - And mathematically you will be able to figure this out. I'm gonna plug our website here. There is an interactive simulator that will take you to the all-in-one simulator where you can compare your existing fixed first lien mortgage to the All in one and and the input data is very, very simple. No vials of blood here guys, but if the input is accurate, the results page will tell you very clearly if the all-in one will save interest and Trump over the 30 year fixed at two and a half or whatever it is, or if you're fixed rate mortgage is more to your advantage, it will be very clear there'll be no mistaking it from that. I think further conversations will be necessary for those that see some real value in the All In One. I won't go too far down that rabbit hole, it's a little bit more complicated than we probably have time for here. But the first Lean All In one is such a fantastic tool. I really encourage your listeners to go ahead and and check out at the very least the simulator and see how it applies to you.
Speaker 0 (00:26:08) - The all-in one loan operates much like a first lien heloc. I don't think we have time to describe it all. Like you said, you do have the simulator there on your email@example.com where one could see if their existing mortgage it compares favorably or unfavorably to the all-in one loan. But as we know with the first lien heloc, therefore one feature of the All in one loan is the option, not obligation, but option of making interest-only payments to keep your payment down.
Speaker 3 (00:26:34) - Yeah, this is where it gets a little bit tricky for some people when we start talking about payments FirstLine Open-ended HeLOCK, where it's called the All In one because you're replacing not only your mortgage with this revolving open-ended heloc, but also a checking and savings account and combining those two elements whereby simple depository income is being used at dollar for dollar driving down principle balance to save in daily interest accrual. I'm gonna give a quick example and then we can move on and, and I encourage everybody to do the simulator email us, let's talk through it. We'll take you by the hand. It's the learning curve's a little intense, it was even for me. But here's an example of velocity of money and kind of how the all-in-one works. So take a 30 year fixed mortgage and a 15 year fixed mortgage. Both of them started at $400,000 each.
Speaker 3 (00:27:22) - You lock the 30 year at 4% and the 15 year was locked at 7%. Without exception, everybody runs to the 30 year at 4%. I would've done the same if I didn't know the math when in fact the reality is is that you will pay $40,000 more on that 4% 30 year than you would on the 7% 15 year because the amount of time that you're paying on that mortgage is greatly reduced. And that's, I guess a, an easy concept. It's a, the first step of trying to define this for most people, they can kind of see it in those terms because they understand the amortized mortgage. It's the amount of time that you are paying interest. So if you're utilizing your depository checking savings and your mortgage and all of that money is going in there month after month before it's going back out the door for whatever your living expenses are. And then whatever's left over is, is stays in there. 24 7 access. Nothing changes about your current banking techniques or or strategies. It's all the same. But now you're in control. You've become your own bank. It's amazing. I can't say enough about it
Speaker 0 (00:28:24) - Talking about the all in one loan there. You sure can learn more from Ridge on that. Jaylee, is there really like anything else that I guess is noteworthy specifically in helping a borrower qualify for income property loans, maybe a common problem or a borrower hurdle that you see in there at Ridge?
Speaker 3 (00:28:43) - I would just boil it down to education. Just lack of information. It's not dear Google stuff. The guidelines and what's available. All of these things are changing on a consistent basis that real-time information's not available to them. So if I had to pick one thing, I would just say education. And I'm very proud to say that we really focus on that. If there's a value add about Ridge, I think there's quite a few. But the one that I think sticks out for most people is the education that we provide to our investors and shining a light and giving them a look under the hood and what they need to know, teaching 'em how to optimize their qualifications and all of the stuff that we've been talking about here today.
Speaker 0 (00:29:19) - Well that's a good point because when we talk about real estate investing, you're really, they're in one of the more dynamic and fast-changing parts of the industry as opposed to something like home construction where a lot of the methods haven't changed for 50 or more years, if you will. So yeah, it's really staying up and staying informed on that and engaging with a lot of the educational resources increasingly that Ridge has for you to help you stay on top of that as an income property bar yourself. And Shaley can tell us a bit more about that shortly. But why don't you tell us about all of the loan types, the mortgage products if you will, that you offer in there.
Speaker 3 (00:29:52) - That's another great value add about us. We have a very diverse menu, if you will, of loan products that don't just start and stop with the conventional. We're not a one size fits all. So we've got the Fannie Freddy's, we talk about that a lot. Our all in one, my favorite. We have a very diverse non QM product line and for those that aren't familiar with that term, QM stands for Qualified Mortgage. Fannie Mae and Freddie Mac are the, uh, epitome the definition of what a qualified mortgage is. There's a whole definition we don't need to go into today, but, so everything outside of that QM is now non qm. And within non qm, like I said, extremely diverse. There's things called the debt service coverage ratio product where we're not showing borrower income, we're just looking at the properties income offset by the new mortgage payment. There's bank statement products. If you can't show tax returns, we're gonna take deposits and average them asset depletion. If you've got large self-directed ira, we can come up with an income calculation for that. The list goes on. We've got commercial products for commercial properties, but also for residential properties. Cross collateralization. It's pretty diverse. We have a lot for everybody.
Speaker 0 (00:30:54) - When you excel in there, you've been such industry leaders at originating income property loans for investors were proportion of your businesses income property loans and what proportion is primary residence loans?
Speaker 3 (00:31:06) - A lot of people don't realize we can do both and we do both very well. But I would say that it's probably 70 30 not owner-occupied. To owner-occupied. A large part of what we do is the investor loans. But most of our investor clients come to us for their primary needs too because we already have their life on file and, and can get that done very competitively
Speaker 0 (00:31:24) - Too. , right? And you keep growing. You're in almost all 50 states now.
Speaker 3 (00:31:27) - I know. Can you believe it? We're in 47 states. We're not in North Dakota, New York, or Vermont, otherwise we're everywhere.
Speaker 0 (00:31:34) - Letter audience know how they can learn about your resources.
Speaker 3 (00:31:37) - There's a couple ways to find us our website, ridge lending group.com. They can email us, info ridge linen group.com. Our toll free is 8 5 5 74 Ridge 8 5 5 7 4 7 4 3 4 3. And while you're on our website gang, uh, check us out on our community. I have a live event every Tuesday, one 30 Pacific, uh, four 30 Eastern. Uh, lots of good information register and it's free. Lots of good information and, and education like we've been talking about here. Hope to see you.
Speaker 0 (00:32:05) - Oh, it's been a terrific and crucial mortgage market update. Chaley Ridge, thanks so much for coming back into the
Speaker 3 (00:32:11) - Show. Thank you. Appreciate it.
Speaker 0 (00:32:18) - Oh yeah, lots of good concise information there from Chaley. It's a type of content that can have you hitting the rewind button on your pod catcher at times. All right, so we learned that in a lot of scenarios there. Second, mortgages come with rather high interest rates that is prohibitive. But then on the other side, it's encouraging to learn, learn that on primary residences, for example, you can get up to 90% loaned value. That means you only need to keep 10% equity in your home. And as far as that all in one loan simulator, we'll put a link directly to that in the show notes for you. But like Chaley said, you might wanna reach out to firstname.lastname@example.org and then they can help walk you through it. Thank you to Caeli for the generous contribution to your learning today. Until next week, I'm your host, Keith Weinhold. Don't quit your daydream.
Speaker 5 (00:33:15) - Nothing on this show should be considered specific, personal or professional advice. Please consult an appropriate tax, legal, real estate, financial, or business professional for individualized advice. Opinions of guests on their own information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of Get Rich Education L l C exclusively.
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