I came across a short sale that can't be financed with conventional loans, due to the amount of repairs needed.

I currently don't have the cash needed to finance the deal personally, as my money is locked in another rehab. I am looking into hard money or private equity to make it work.

I have access to a friend with enough money to work as a private lender also have been approved by a hard money lender in the past.

The realtor said I need to provide a proof of funds. How do I do it? What is the best way to provide the documentation necessary?

bump!

"Proof of funds" is a bank statement with the same name as on your offer showing enough cash to close. If you have a friend with cash you could do the deal as partners. Write the offers in both of your names and include a bank statement from him. Or, write the offer as financed, include a letter from him saying he agrees to loan you the money and a bank statement. Not as strong, but it might work.

Ask the listing agent if they will accept an offer with financing utilizing a HomeStyle Renovation loan. This product is pretty flexible and allows up to 50% of the ARV to go to repairs, as long as the repairs are adding value.