Many Buyers are looking to purchase distressed property as the Spring market brings out NEW inventory of REO's and Short Sales. Many are trying to secure the winning bid with an ALL CASH purchase or with a LARGE down payment using an Investor or Conventional Loan.
Many of these clients must wait 15 (fifteen) days before they can even submit an offer as many banks are trying to give First Time Homebuyers and/or Returning Homeowners the first opportunity to secure a contract on these houses.
I know that many of my Investor client ask me to package an offer together on the off chance that there won;t be any bids from owner occupants. Then once the 15 (fifteen) days have passed , they have me submit the offer according to the Listing agents instructions.
When preparing an offer that is all "CASH" or has a "LARGE" down payment the mortgage company will request the agent to verify the funds that the buyer is using to purchase the property. These funds are called HARD PROOF OF FUNDS and they can come in several accepted formats as noted below.
- Current Bank Statement - Checking or Savings
- Money Market Fund , Self Directed IRA
- A dated statement from the Purchaser's bank on letterhead signed by the Branch Manager with the financial information noted.
All of these "HARD PROOF OF FUNDS" must of course have the same name on them as the name of the purchaser on the contract offer. The other rule of thumb that a buyer agent should be aware of and inform their client of is that the statements can not be more than 30 (Thirty) days old , and is some cases no more than 14 (Fourteen) days old.
Due to these restrictions you would want to inform the buyer to send you another set of updated financial statements as the mortgage company may not always respond and.or accept the contract before the HARD PROOF OF FUNDS are older than 30(Thirty) days old