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Steph C.
Pro Member
  • Real Estate Investor
  • Bristol County, MA
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153
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Proof of Funds Letter for REO/Rehab

Steph C.
Pro Member
  • Real Estate Investor
  • Bristol County, MA
Posted Aug 16 2010, 11:56

Hello,

We submittted an offer on Friday for an REO for a rehab deal. We included our $1000 earnest money, a valid p&s and all other requirements via our Realtor. We also had a proof of funds letter from a well established rehab lender.

The Agent that deals with the bank has not submitted our offer yet because our proof of funds letter did not state a specific amount or percentage as our downpayment. The lender did a revised letter for me (which I submitted but was again rejected), but did not give a specific amount for a downpayment, because this is just a letter to submit the offer, and the final purchase price will likely change (primarily because the offer is subject to a Title V inspection, which if the septic system doesn't pass, the cost for replacement would be about $25k to $30k for a house this size, and we would lower our offer accordingly).

Anyway, I know full well the bank is going to counter and they may even counter to a price we won't accept. That being said, I cannot understand why they won't even submit the offer to the bank. Has anyone heard of this?

I have been trying hard today to get a lender to give me a proof of funds letter that would show a downpayment amount (even if it shows a % amount, not a dollar amount), but I haven't had luck yet. I've talked to some really great people today, however, none so far were able to help me in my specific situation.

Back a while ago, we successfully purchased a HUD house and I didn't have to jump through hoops to get a "special" proof of funds letter. The one I submitted (which said nothing about a downpayment) was accepted.

Any thoughts or suggestions? Do I walk away because this bank is going to make my life difficult (it's not BoA, FYI)? :-)

I know people who use any old "flash funding" proof of funds letter and don't get this much hassle from a bank to just make an offer.

Steph

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