How to Offer a Proof of Funds Letter in Short Sales
Proof of funds is required when you are submitting an offer for a real estate property where you will be submitting a cash offer. The most common scenarios are for short sales and buying foreclosure properties that do not qualify for typical financing. The proof of funds allows the person selling the property to verify that you have the funds to complete your offer. Depending on the seller and what property you are buying, you will be required to provide different types of proof of funds.
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Instructions
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Print your most recent bank statement from your bank. Ensure the statement shows your balance in your account.
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Black out sensitive information from the bank statement. This includes transactions that appear in your bank statement and your bank account numbers. You can now submit this proof of funds with your offer. If the seller rejects this proof of funds document, then you will need a proof of funds letter.
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Contact your bank and ask for a proof of funds letter. Depending on your bank, this can take up to two weeks for the letter to arrive. And the bank might charge you a fee. This is a highly acceptable proof of funds letter that you can submit if the seller rejects your bank statement.
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Contact your "hard money" lender if you are buying the property using a hard money loan. Ask the hard money lender for a proof of funding letter. The hard money lender usually will provide the proof of funds letter faster than a bank. Usually the lender does not charge for the letter. A hard money lender is usually used only by real estate investors as they provide money to buy homes that are not eligible for regular lending.
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References
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