RMG attorneys offer due diligence review services for bulk loan purchase transactions and provides an unsurpassed combination of experience and flexibility. Our due diligence reviews are done by seasoned commercial attorneys who will provide the full scope of loan file review, or a more limited review dictated by the client and circumstances. Here are some of the questions you may have about due diligence reviews:
Q: What is a legal due diligence review?
A: A due diligence review is a legal review of the loan documents (and possibly credit files as well) making up a pool of loans that are being offered for sale (or as collateral for a securitization) by a financial institution.
Q: What is done by the attorneys?
A: • Review of all material loan documents;
• Review of all litigation files relating to the obligors;
• Review of credit files;
• Uniform Commercial Code searches
• Review of all title insurance policies
Q: How long will it take?
A: The major factor determining time requirements will be the number and complexity of the loans being reviewed. However, we will do whatever is necessary and feasible to meet your time requirements and deadlines.
Q: Is it expensive?
A: The cost will be a function of whether the documents are available electronically, the desired reporting and the number of loans. We can be flexible in quoting a fixed price once we obtain the necessary information.
Q: Why is it important to conduct a due diligence review?
A: Our review will advise you if there exist flaws in your legal documents, if you are missing significant documentation, whether your collateral is properly perfected, whether you have title insurance coverage providing first priority liens without material exceptions, and other valuable information. Particularly, if you are purchasing a troubled loan portfolio, this will be critical when and if you need to exercise default remedies.
RMG attorneys are prepared to draft and negotiate loan sale agreements; assist in the preparation of pre-sale due diligence for sellers of loan pools; conduct loan pool due diligence for purchasers; draft and negotiate servicing agreements; represent purchasers in the administration and collection of loans and the resolution of problem loans; and handle the post-closing “put” of loans not conforming to sale representations. Additionally, we can provide legal representation in connection with the closing of acquisition financing of the pools, and secure the acquisition credit facilities.