An Interview with Caeli Ridge

By Christina Suter on Sep 29, 2018 at 10:00 AM in Real Estate Issues

This week I had the opportunity to speak with a brilliant and powerful woman with whom I was very taken. As a female in real estate, Caeli's integrity, authenticity, directness, and her knowledge and expertise are why I invited her to speak at my upcoming FIBI Pasadena meeting.

Caeli is the President and CEO of Ridge Lending Group (RLG) a company that covers numerous product models within the lending field. Caeli (pronounced Chay-Lee) has spent the last 18 years as a nationwide lender, loan officer, and real estate investor in both residential and commercial properties. She has worked with tens of thousands of investors and homeowners and has helped more families realize their dreams of homeownership than any other mortgage lender in the country.

RLG is a second-generation boutique lending company that was started by Bill Ridge, Caeli's father. Caeli began running operations at RLG in 2005 and officially took over in 2009. RLG focuses almost exclusively in the non-owner occupied side of lending and they're a fully functional lending company. RLG is licensed nationwide and Caeli has worked with investors for over 20 years and she's also a real estate investor who's held 42 properties at any one time across the US.

As an investor looking to purchase a single-family residence to rent, you can get a "golden ticket" which are Fannie Mae and Freddie Mac loans that have the highest leverage with the lowest interest rates. RLG helps place investor types into those properties as their ratio is about 90% residential to 10% commercial funding. I asked Caeli how she helps investors like me who don't have traditional income streams get into a "golden ticket." As a lending company, Caeli says RLG goes to great lengths to overanalyze in pre-qualification. She says about 90% of their due diligence happens during the pre-qualifying stage so they can mitigate damage in the actual transaction and because most clients will continue to purchase and refinance in the long-term so they have a template or baseline of their file for future purchases.

I expressed to Caeli that one of the things I love about her work is the level of detail she provides as well as her knowledge and willingness to share her knowledge. Caeli said she enjoys sharing because "a lot of times the financing is this weird, secret society of information [like] that black box that's on an airplane, you know there's good intel in there, but how do I get to it?"

She explained how investors who come to RLG go through the loan underwriting process. "For each qualified individual there are 10 gold tickets and we exhaust those first. We advise our clients to qualify independently of each other if they're a couple in the workforce." There are a lot of moving parts that go into underwriting a loan Caeli says, but the three most heavily weighted criteria are, credit score, assets, and debt to income ratio. Of the ten golden tickets, there are two distinct underwriting books that the individual has to qualify with and that we as the lender have to adhere to, to get them a loan. The first book is applicable to the loan spots 1-6 and the second book of underwriting guidelines covers 7-10."

Credit: the minimum requirement for credit score in spots 1-6 is vague but in 7-10 the hard and fast is a 720 score or greater (middle).

Assets: The two types of assets RLG considers are liquid (checking, savings, money market accounts) and non-liquid (retirement accounts, life insurance accounts, etc.) Those assets are applied in underwriting in two ways, one being your cash to close and the second is your reserve requirement. The cash to close has to be liquid and has to be sourced in season. So in two months of bank statements clients provide, if there's a large deposit it will be questioned and if it didn't originate with the individual they won't be able to use it. So if your aunt gifts you money, it must remain in your account for two months so that the deposit doesn't show, just the balance so it can be considered seasoned. The reserve can be in liquid or non-liquid form to qualify. 

Debt to Income Ratio: RLG takes the monthly income from the client-supplied documents and divides it by the monthly liabilities almost exclusively found on the credit report. The almost is equal to three things, if you're a renter, (present housing expense) if you don't pay your taxes and insurance with your mortgage payment, (those won't be on the report) and HOA dues. Everything else comes from your credit report, so cell phone bills, gas, entertainment don't get factored in.

I asked Caeli about people who don't fit into the preferred 10 and she said there are products that fall under RLG's specialty loan terms (non-qualified mortgage Non-QM). Their specialty loan products include bank statements, (12 or 22 months) a debt service ratio product (gross rents divided by the principal, interest, taxes, insurance--piti). On the commercial side, Caeli says RLG is a little more limited on the product line. Their minimum commercial loan size is $500,000 (not to be confused with purchase price). 

More information from Caeli and Ridge Lending Group can be founda t or email [email protected] You can also call 855.74RIDGE (855.747.4343).