Dear Investor,
If you are looking for bulk REO properties nationwide, we have the source. Whether you wish buy geographically or not, we can find you some great deals.
We have compiled this document to make clear the necessary steps and documents that will be required to move forward with your bulk REO purchase.
Our intent is to find serious buyers who wish to establish a long term relationship that benefits all parties.
We make tapes available on request dependent the specific information you submit to us and with the proper paperwork.
The document below outlines the process of purchase bulk REO properties through us. Included are the necessary forms which you will also find on the forms pages.
We look forward to doing business with you.
Sincerely,
Patrick Killian
HOW TO CLOSE YOUR REO DEAL WITH US
1. NCND
4. Required Signatures Authorized signatory and mandate are required to sign the NCND. Signatures of the intermediaries will be required on the MFA to get paid. Once again, the MFA will be provided by the Seller after the NCND has been accepted by the Seller. Make sure signatures of buyer and/or signatories are on the documents.
5. Permission is granted
if…
Working Protocols: In regards to a working business relationship with parties in the bulk REO portfolio business, preference is made to those who are of three people. This would be the buyer's mandate, the buyer's rep, or the facilitator (intermediary). We can not make contact calls through broker chains. We must be able to allow mandates or signatories the opportunity to talk with each other with no delay.
NON PERFORMING ASSET (NPA) An asset or account of a borrower, which has been classified by a bank or financial institution as sub-standard, doubtful or a loss asset. An amount due to any lender is treated as "past due" when it has not been paid within 30 days from the due date. i. interest and /or installment of principal remain overdue for a period of more than 60 days on a given loan, ii. the account remains 'out of order' for a period of more than 180 days, in respect of an overdraft/ cash Credit, iii. the bill remains overdue for a period of more than 180 days in the case of bills purchased and discounted, iv. interest and/ or installment of principal remains overdue for two harvest seasons but for a period not exceeding two half years in the case of an advance granted for agricultural purpose, and v. any amount to be received remains overdue for a period of more than 180 days in respect of other accounts. (Source USLending Commission) Banks have decided to adopt the '90 days overdue' norm for identification of NPA’s form the year ending March 31, 2004. Accordingly, with effect form March 31, 2004, a non-performing asset (NPA) shell be a loan or an advance where; i. interest and /or installment of principal remain overdue for a period of more than 90 days in respect of a Term Loan, the account remains “out of order” for a period of more than 90 days, in respect of an ii. overdraft/ cash Credit(OD/CC), iii. the bill remains overdue for a period of more than 90 days in the case of bills purchased and discounted, iv. interest and/ or installment of principal remains overdue for two harvest seasons but for a period not exceeding two half years in the case of an advance granted for agricultural purpose, and v. any amount to be received remains overdue for a period of more than 90 days in respect of other accounts. (Source USLending Commission) “Out of order”
Overdue
Portfolio Qualifications
TO BUYERS:
We appreciate your inquiry, however, there are MANY more Buyers for REO portfolios than there are legitimate Sellers with real inventory. Therefore, we only accept new Buyers that already have funding in place and are prepared to consummate a transaction when we deliver a package that meets their specifications. All new Buyers must have their funds "pre-verified" by a 3rd party independent service . . e.g. if they want a 50m package @ 47 + 3, they must have $25,000,000 available now.
The "pre-verification" process is quick and easy . . . simply have your potential Buyer contact the verification service. The 3rd party service verifies funds and sends us an e-mail stating that Buyer #1234 has sufficient funds to purchase the package they want. We do NOT know the Buyer's name, we have no contact information and we have no financial details other than that the Buyer has sufficient funds at this time.
Once funds are "pre-verified", we will need a signed NCND and an LOI stating the Buyer's very specific requirements (e.g. geographic regions, property price ranges, condition, acquisition price, etc.). The Buyer will also need to be prepared to offer proof of funds to the Seller's escrow agent or attorney. Please contact us when your Buyers have been "pre-verified" and are ready to issue an LOI that is real and has NOT been shopped to anyone else.
TO SELLERS:
We appreciate your inquiry as we are always interested in establishing relationships with reliable sources of REO packages for our Buyers. We utilize a 3rd party independent service to "pre-verify" that our Buyers already have funding in place and are prepared to consummate a transaction when we deliver a package that meets their specifications. To safeguard our Buyers, we also "pre-verify" new Sellers and we use the same 3rd party independent verification service to do so. We do NOT want or require financial details, however, prospective Sellers must be willing to provide the verification service proof of previously closed REO portfolio transactions (e.g. sanitized settlement statements or HUD-1's) and/or a snap shot of several tapes currently in escrow.
The "pre-verification" process is quick and easy . . . simply have your potential Seller contact the verification service. The 3rd party service will verify that the Seller has closed prior REO transactions or has tapes currently in escrow and will send us an e-mail stating that Seller #4321 is legitimate. We do NOT know the Seller's name, we have no contact information and we have no financial details other than that the Seller has the ability to provide tapes and close deals.
Once a Seller is "pre-verified", we will need a signed NCND, the Seller's purchasing protocol and specifics regarding what products the Seller can provide. The Seller will also need to be prepared to offer proof of product to the Buyer's escrow agent or attorney.
The Letter of Intent
A Letter of Intent ("LOI"), also known as Memoranda of Understanding and Memoranda of Agreement, is used to signal parties' agreement to the basic structure of serious negotiations to close a deal. An LOI typically comes into play after a round of initial discussions and after the signing of a Confidentiality Agreement and a second round of more serious discussions about the proposed transaction.
and to the Deal
Signing a letter of intent, from a business perspective, indicates that each party has obtained approval to work towards closing the proposed business transaction and that the parties have moved into a stage of serious negotiations. This is where you lose the tire kickers. 1. Commitment to the Deal: By signing the LOI this tells the parties involved that this person is a real player and has stepped up to the plate. 2. Commitment to a Time Line: An LOI will set forth a time line for negotiations, including a deadline for closing the deal and what will occur if the parties fail to meet the deadline. Confidentiality : If not already agreed to in a Confidentiality Agreement NCND, each party will agree to keep the transaction and information exchanged in negotiations confidential in an LOI.
Letter of Intent Guidelines
(Must be on Buyer's Company Letterhead) A Letter of Intent must include: 1. Company Identity (name, address, phone/land line) 2. Principle (name, phone/land line), 3. Means to provide proof of funds, (Custodian of Funds - Name, role, attorney, broker house, etc. and phone/land line) 4. Institutional Information - Bank name, bank manager name, office phone number 5. The criteria buyer is looking for (include low-end and high-end LTV range, geographical preferences, property types, etc.) 6. Exit strategy 7. Include number of days in which Letter of Intent will expire. 8. Buyer's Signature
LOI Template - Company/Buyer Letterhead
Date:
RE: Letter of Interest
To whom it may concern: Authorizing ________________________ of __________________________________________________________ and _________________________ of ___________________________
“Company/Buyer name” is interested in purchasing your 'description of REO portfolio”
The following is what we understand and are interested in:
Ø Cash Buyer Ø Will produce POF Bank to Bank
All LOIs must be signed by _________________________
All LOI's should be verified with _____________________ at (Phone number)
Please do not hesitate to call if you have any questions.
This LOI Expires at 5:00pm EST on __________________ XX, 2008
Very truly yours,
Company/Buyer name
Buyer’s Purchase Capacity
___________________________ (Buyer) asserts that using the following assets, it has the cumulative purchase capacity on a one time or revolving monthly basis of $_________________________.
Available for cash transactions: $______________________________
Name of bank where cash assets are located: ______________________
A. Name of bank officer for confirmation: ___________________
Phone number of Bank officer for confirmation: ____________
B. Warehouse Line of Credit: $____________________________
Name of bank where line of credit is authorized: ____________
Name of bank officer for confirmation: ___________________
Phone number of Bank officer for confirmation: ____________
C. Traditional Financing: $_______________________________
Name of bank where credit line is authorized: ______________
Name of bank officer for confirmation: ___________________
Phone number of Bank officer for confirmation: ___________
Upon initial overview of offering _______________________________ will supply the seller with a letter of intent and escrow required funds to secure the portfolio considered and will provide verifiable POF, bank to bank or attorney to attorney.
Buyer Signature: ____________________________________________________
Title: ____________________________________________________
Buyer Initials ______________
Non-Circumvent Non-Disclosure Agreement
We require that this document be signed as a “good faith” commitment to do the deal as per our agreement.
PARTIES AND PURPOSE
The undersigned are mutually desirous of doing business with respect to the arranging, selling and buying of REO Notes and REO Property Portfolios in cooperation with one another and with third parties for the mutual benefit of all. It is their intention that the information exchanged among the signatories in the course of doing business, as well as the documents which will be generated subsequent to the execution of this Agreement, including but not limited to letters of intent, full corporate offers, bank comfort letters, contract terms and conditions, banking details or pre-advised payment instruments, and/or any information contained in such documents, will not be passed, under any circumstance, to another intermediary or broker or trader or any other company or private person who is not an end buyers end supplier, without prior specific written consent of the party or parties generating or with proprietary rights to such information and/or documentation.
This Agreement shall obligate the undersigned parties and their partners, associates, employers, employees, affiliates, subsidiaries, parent companies, nominees, representatives, successors, clients and assigns (hereinafter collectively referred to as ‘The Parties’) jointly, severally, mutually and reciprocally for the term of and to the performance of the terms and conditions expressly stated and agreed to below. Furthermore, whenever this Agreement shall be referenced in any subsequent document(s) or written agreements, the terms and conditions of this Agreement shall apply as noted and shall further extend to any exchange of information, written, oral or in any other form, involving financial data, personal or corporate names, contracts initiated by or involving the parties and any addition, renewal, extension, rollover amendment, renegotiations or new agreement that are in any way a component of what shall hereinafter be referred to as ‘The Project’ or ‘The Transaction’ for the purchase of the subject commodities, products, and/or equipment.
NOW, THEREFORE, IT IS MUTUALLY AGREED;
AGREEMENT NOT TO DEAL WITHOUT CONSENT
The Parties hereby legally, wholly and irrevocably bind themselves and guarantee to one another that they shall not directly or indirectly interfere with, circumvent or attempt to circumvent, avoid, by-pass or obviate each others’ interest, or the interest or relationship between The Parties, by means of any procedures, sellers, buyers, consultants, dealers, distributors, refiners, shippers, financial instructions, technology owners or manufacturers, for the purpose of changing, increasing or avoiding, directly or indirectly, payments of established or to be established fees, commissions, or the continuance of pre-established relationships, or to intervene in un-contracted relationships with manufacturers or technology owners, intermediaries, entrepreneurs, legal council, or to initiate any buy/sell or any transactional relationship that by-passes one of The Parties in favor of any other individual or entity, in connection with the subject Transaction or Project or any related future Transaction or Project.
AGREEMENT NOT TO DISCLOSE
The Parties irrevocably agree that they shall not disclose or otherwise reveal directly or indirectly to any unauthorized individual or entity any confidential information provided by one party to another, including but not limited to contract terms, product information or manufacturing processes, prices, fees, financial agreements, schedules and information concerning the identity of sellers, producers, buyers, lenders, borrowers, consultants, distributors, refiners, manufacturers, technology owners, or the representatives of any of the above, as well as names, addresses, principals or telex/fax/telephone numbers, references to product or technology information and/or any other information deemed confidential or privileged within the broadest possible scope of The Project or The Transaction without prior specific written consent of the party or parties generating or with proprietary rights to such information.
RELATIONSHIPS AND PREVIOUS RELATIONSHIPS
If either Party has already established a previous relationship with the parties to a transaction or the contact introduced in the specific transaction, the Party with the previous relationship or transaction will immediately notify the other Party by email or fax outlining the prior relationship and, in that specific case, the Party with the previous relationship or transaction will be exempt from the non-circumvention clause of this Agreement. The other Party reserves its abilities and rights to dispute the existence of prior relationship. Furthermore, the Parties agree that this Agreement shall not be construed to impede the development of normal day to day business relationships regardless of the existence of a pre-existing relationship on the part of either party, such as, other direct sellers of REO portfolios and notes, including but not limited to, lenders and other mortgage brokers.
AGREEMENT TO HONOR COMMISSIONS
Commissions, fees, compensation or remuneration to be paid as part of The Transaction or The Project anticipated by this Agreement shall be agreed upon by separate written agreement of The Parties concerned and shall be paid at the time and in the manner designated in such separate agreement, unless otherwise agreed among the affected Parties.
All Parties hereby irrevocably and unconditionally agree and guarantee to honor and respect all such fees and remuneration arrangements made as part of a commission transaction, even if an individual Party is not an integral component of and/or a signatory to a specific commission, fee or remuneration agreement.
AGREEMENT TO INFORM
In the specific situation where a Party acting as an agent of the buyer allows the buyer or the buyer’s representative and the seller to deal directly with one another, said agent shall be informed of the subsequent development of all transactions between the buyer or the buyer’s representative, and shall be provided timely copies of all pertinent developmental and/or transactional correspondence and documentation relative thereto by the buyer or the buyer’s representative and/or the seller.
CONTRACTS AFTER AGREEMENT TERM Both Parties agree not to make contact with, solicit, deal with, or otherwise be involved in any transaction(s) with regard to source, contact, trust, client, strategic partner and/or other entity that the other Party introduces to or discusses with the other Party for a period of 18 months after the termination of this Agreement.
INJUNCTIVE RELIEF AND PENALTIES
The Parties agree that in the event there is a violation of this Agreement, the Non-Violating Party is entitled to injunctive relief. Furthermore, any violation of this Agreement is enforceable by a penalty of 200% of actual damages per incident and such penalty shall apply to any and all subsequent transactions with that source, contact, trust, client, strategic partner and/or other entity. This penalty shall survive the term of this Agreement and all extensions or rollovers.
TERM
This Agreement shall be valid for five (5) years commencing from the date of this agreement. This Agreement may be renewed for a further period of five (5) years, subject to and upon the terms and conditions agreed between and among the signatories.
This Agreement shall apply to:
Ø All transactions originated during the term of this Agreement. Ø All subsequent transactions that are follow up, repeat, or extended transactions or renegotiation(s) of transactions originated during the term of this Agreement.
ARBITRATION
All disputes arising out of or in connection with this Agreement shall be finally settled under the rules of arbitration of the ‘State of California’ by one or more ‘Arbitrators’ appointed in accordance with said rules. All such arbitration awards shall be binding on all Parties and enforceable at law.
The Parties further agree to carry out the terms of any arbitration award without delay and shall be deemed to have waived their right to any form of alternative recourse, by or through any other means, insofar as such waiver can validly be made.
Each of The Parties named in an Arbitration proceeding and/or required to appear under such a proceeding, unless otherwise agreed, shall be responsible for its own legal expenses. The prior sentence notwithstanding, any Party adjudged by the Arbitrator to be in material breach of this Agreement shall compensate in full the aggrieved party, its heirs, assignees and/or assigns, for the total remuneration received as a result of business conducted with The Parties covered by this agreement, plus, subject to the determination of the Arbitrator, all its arbitration costs, legal expenses and other charges and damages incurred relative to its dealings with banks, lending institutions, corporations, organizations, individuals, lenders, or borrowers, buyers or sellers that were introduced by the aggrieved party, notwithstanding any other provisions of the award.
FORCE MAJEURE
A Party shall not be considered or adjudged to be in violation of this Agreement when the violation is due to circumstances beyond its reasonable control, including but not limited to Acts of God, natural disasters, civil disturbances, war, fires, floods, strikes and failures of third parties to perform their obligations to either Party. As a condition to the claim of non-liability, the party experiencing the difficulty shall give the other prompt written notice, with full details following the occurrence of the cause relied upon.
ENTITIES OWNED OR CONTROLLED
This Agreement shall be binding upon all entities owned or controlled by a party and upon the principal(s), employee(s), assignee(s), family and heirs of each party. Neither party shall have the right to assign this Agreement without the express written consent of the other.
AGREEMENT NOT TO CIRCUMVENT
The Parties agree not to circumvent or attempt to circumvent this agreement in an effort to gain fees, commissions, remunerations or considerations to the benefit of the one or more of The Parties with the full knowledge and acquiescence of all necessary Parties, whether or not such fees, commissions remunerations or considerations gained through circumvention would otherwise be deemed the rightful property of any one or several of The Parties.
NOT PARTNERSHIP AGREEMENT
This Agreement in no way shall be construed as being an agreement of partnership and none of The Parties shall have any claim against any separate dealing, venture or assets of any other party, nor shall any party be liable for the separate and independent actions of any other.
SEVERABILITY
If a court or arbitrator finds any provision of this Agreement invalid or unenforceable, the remainder of this Agreement shall be interpreted so as best to affect the intent of the Parties. This Agreement will be governed by and construed in accordance with the laws of the State of California.
TRANSMISSION OF THIS AGREEMENT
Any accurate and legally binding version of this Agreement accurately transmitted through MSN Messenger or any similar programs, as well as tele-fax or e-mail programs, shall be deemed an equivalent, original, legal and binding version of this Agreement.
AGREE AND ATTESTED
Each representative signs below guarantees that he/she is duly empowered by his/her respectively named company to enter into and be bound by the commitments and obligations contained herein either as an individual, corporate body or on behalf of a corporate body.
1) Final Signature – Seller’s Mandate or Representative Signatory Details
Signatory’s Full Name: Company Name: Address: Phone: Fax: E-Mail:
Signature Signed Date
2) Intermediary Group Signatory Details
Signatory’s Full Name: Company Name: Address: Phone: Fax: E-Mail:
Signature Signed Date
3) Intermediary Group Signatory Details
Signatory’s Full Name: Company Name: Address: Phone: Fax: E-Mail:
Signature Signed Date
4) Intermediary Group Transaction Coordinator Signatory Details
Signatory’s Full Name: Company Name: ____________________ Address: ____________________________ Phone: _________ Fax: _________ E-Mail: ______________________ ____________________
______________ _________ Signature Signed Date
5) Intermediary Group #3 Signatory Details
Signatory’s Full Name: Company Name: Address: Phone: Fax: E-Mail:
Signature Signed Date
6) Buyer’s Mandate or Representative Signatory Details
Signatory’s Full Name: Company Name: Address: Phone: Fax: E-Mail:
Signature Signed Date
7) Buyer’s Signatory Details
Signatory’s Full Name: Company Name: Address: Phone: Fax: E-Mail:
Signature Signed Date
BUYER MANDATE ATTESTATION
I, _____________________________, attest, under PENALTY OF PERJURY of law, that I have authorization to submit this order and that I have on file an NCND and LOI, both signed by the buyer within the past 96 hours for this transaction.
Portfolio Description:_________________________________________________
(Initial applicable item below)
____ I am a mandate to the buyer with written authority to sign and/or act on behalf of the buyer for this transaction.
____ I am a mandate to the buyer without signatory authority. I do not have written authority to sign and/or act on behalf of the buyer for this transaction.
____ I am not a direct mandate, but I have written authorization to submit this package on behalf of the buyer.
Name:______________________________________________________
Signature: ______________________________ Date: ______________________
Contact Info: Company: __________________________________________________________
Address:____________________________________________________________
Email:________________ Buyers Name:_______________________
_______________________________ Buyers Signature
Email: _____________________________ Phone: _____________________________ Fax: _______________________________
Upon completed Master NCND and Mandate Attestation (from authorized mandate/rep to the seller mandate), I will tell the buyer/rep/mandate who to make the LOI and POF and Master Fee Agreement out to and give direct contact info to the person holding the LOA and Tape, and the buyer can send their info direct without any intermediary contact.
SELLER MANDATE ATTESTATION
I, _____________________________, attest, under PENALTY OF PERJURY of law, that I have authorization to submit this product and that I have on file an NCND and LOI, both signed by the seller within the past 96 hours for this transaction.
Portfolio Description:_________________________________________________
(Initial applicable item below)
____ I am a mandate to the seller with written authority to sign and/or act on behalf of the seller for this transaction.
____ I am a mandate to the seller without signatory authority. I do not have written authority to sign and/or act on behalf of the seller for this transaction.
____ I am not a direct mandate, but I have written authorization to submit this package on behalf of the seller.
Name:______________________________________________________
Signature: ______________________________ Date: ______________________
Contact Info: Company: __________________________________________________________
Address:____________________________________________________________
Email:______________________________________________ Sellers Name:_______________________
_______________________________ Sellers Signature
________________________________________ ________________________________________
Email: _________________________________ Phone: _________________________________ Fax: ___________________________________
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