Administrators of Refund Home Loans have reportedly issued two draft contracts for the sale of the business, with a third contract expected to be drafted soon.
A letter from Refund Home Loans administrator SV Partners has been sent to franchisees advising them of the draft contracts, said industry website Australian Brokernews.
SV Partners is currently awaiting response on any amendments required to the contracts and has told creditors it is in their best interests for the negotiations to run their full course.
“Whilst the terms of all three offers are different, we believe that all three offers will provide creditors and franchisees with a better result than if the company is wound up and a sale does not occur,” the letter says.
Refund Home Loans, which was started by Wayne Ormond, was placed in administration in October last year and owes 119 creditors a combined $9.7 million.
Creditors include Refund Home Loans franchisees, law firm DLA Piper, mortgage broking training provider Intellitrain and WA-based Ourimbah Holdings Pty Ltd.
A sale before Christmas had been targeted.
Before its collapse Refund was valued by Deloitte at between $40 million and $50 million, but the company struggled to obtain additional lines of funding after expanding into real estate services and financial planning and was forced into administration by its lender.
Ormond said in December that while he had managed to raise $1.5 million from two investors before the collapse, he could not raise enough money after the share market collapsed and the business environment turned sour.
This article first appeared on Property Observer.
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