Proof of Funds

9 Replies

Do you always use a proof of funds letter? How important are they to your wholesaling business since you can pretty much buy them online?

@Alanya Boyer I only use proof of funds if the seller asks for them. It's not that I'm trying to hide anything, but generally I like to keep the process as simple for them as possible and it would be weird for me to say "Don't you want to see my proof of funds".

Most motivated sellers won't ask you for such thing. Generally you'll only get those request from properties listed on MLS.

Hope this helps.

Originally posted by @Alanya Boyer :
Do you always use a proof of funds letter? How important are they to your wholesaling business since you can pretty much buy them online?

I have no idea on line. Bet you know you'll be asked here for MLS listings, although that's not a good source for wholesale deals.

My last wholesale deal had no money in the deal, none, not ten cents. The reason O didn't have to provide proof of funds was because I told the owner at the very beginning that I may buy it, but that if I didn't I knew others who likely would and that I would assign the contract. He didn't care. Most sellers won't if they name their price or agree to accept a price.

I wouldn't use a fake statement, several attorneys here would nail you if your deal blows up and you fail to close after you imply having the ability to perform.

We ought to get together some time, neighbor! LOL Connect and you can tell me your war stories from your Realtor days. :)

Never used a fraudulent proof of fund's letter it could come back to bite you.


Joe Gore

@Alanya Boyer You will need proof of funds if you are making offers off of MLS listings or online auctions. You will also need proof of funds if you are processing a short sale for a property. You don't need proof of funds if you are buying from a wholesaler online or directly from a homeowner for wholesaling.

Cheers!

I rarely sell as I am a buy and hold. When I do sell I always ask for proof of funds. I don't care if the buyer assigns that's fine with me but there are too many inexperienced people claiming all cash who cannot and will not actually close the deal due to their inexperience or plain fear. I hate their wasting my time where a "real" buyer likely won't.

So I always ask someone presenting an "all cash" offer to me bring a proof of funds from a local bank sufficient to close the sale.

Thank you all so much! That was basically what I wanted to know...whether motivated sellers typically ask for them. I guessed probably not. I would never use anything fraudulent in my business, just wondered if they even meant much these days.

@Bill, I would love to! I don't know how to tag names so I hope you see this.

I am new to the apartment buying/selling game and even in SFH some sellers are asking for proof of funds or they want to know where you are getting your funds from. I tell them that I may assign the deal to someone else and they still ask for a pre-qual of POF. Now I have noticed if you are going to assign it is important to let them know it and if you have a pre-qual they may not care but it is becoming more and more often that people are asking for it.

The reason they are asking for a POF makes sure you are the real deal.


Joe Gore

@Alanya Boyer  for me it depends on the size of the deal, the market and the players involved. I don't wholesale but I buy large apt communities so I use them pretty much on every offer to show credibility. However, when I was buying single family homes in DFW I didn't use it once. 

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