How to provide proof of funds with private money

Buying & Selling Real Estate
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How to provide proof of funds with private money

Eric Davenport
Taylor Mill, KY · Member since 2017 · 47 posts · 16 votes

Hello, I plan on using private money to fund a BRRRR in the form of cash not HELOC or another type of loan. What is the best way to provide proof of funds that this person is lending us the money in order to place a bid on an auction?

Thank you!

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Caroline Gerardo
Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
5y

You need to show cash as in a checking account for them to believe you. If it's in a HELOC my assumption is the auction will require them to transfer into a checking account.

lol

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  • Caroline Gerardo
    Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
    5y

    Auction wants cashier's checks. IF private money is family they can provide their bank statement. If hard money it's not workable at a: tax auction, county auction, auction.com etc...

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  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    5y

    @Eric Davenport A POF is for a Cash offer and is evidence that the Buyer has the Cash Already in an account in their name. Money from a private lender is a Loan.

    1Reply
  • Eric Davenport
    OP
    Taylor Mill, KY · Member since 2017 · 47 posts · 16 votes
    5y

    @Caroline Gerardo thanks for the reply. The private money is family, would we also need a statement from them stating who they are and they are lending the money, or the bank statement is enough? Also, how does it change if using a family member's HELOC?

    0Reply
  • Caroline Gerardo
    Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
    5y

    You need to show cash as in a checking account for them to believe you. If it's in a HELOC my assumption is the auction will require them to transfer into a checking account.

    lol

    1Reply
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