Rounding out a great week of matter on bank counter offers, there are still a number of fine tales to tell. Kevin and Fred haven’t been very emotional this week, but they are on leave in Italy. So, we should all give them a break. As is custom with Friday, it’s time for a tale.
Recently there was a situation with Aurora Loan Services. Kevin and Fred knew the BPO on this short sale since they had a previous offer that was approved, but the buyer cancelled. So, Kevin and Fred got a new offer with all of the usual fees and closing costs. Yet, the negotiator told the Group 46:10 workers that the closing costs needed to be removed. Initially, Kevin and Fred were not sure if this was a mitigation counter offer or a collection counter offer. Nonetheless, they ultimately learned that the counter offer was about net proceeds. Through some exhaustive paperwork, they were able to reduce the closing costs because of some taxes that had previously been paid.
Essentially, Kevin and Fred just wanted to know what the lender needed to retrieve in net proceeds with this loan.
Herein lies the premise behind the entire week of conversations on counter offers. The negotiator let Kevin and Fred know that she needed to net $266,000 to get this agreement completed. As soon as all entities had the equal information, they could all work to get to the same position and close the transaction.
The end result is that the negotiator was trying to net about 85% on the deal and there was a second note that wanted a few thousand dollars. Basically, when everybody shares what they need from a transaction, the deal can get done. Net proceeds are the lone thing that matters!
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